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MGN LIMITED v. THE UNITED KINGDOM - 39401/04 [2011] ECHR 919 (9 June 2011)
URL: http://www.bailii.org/eu/cases/ECHR/2011/919.html
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[2011] ECHR 919
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FOURTH
SECTION
CASE OF
MGN LIMITED v. THE UNITED KINGDOM
(Application
no. 39401/04)
JUDGMENT
(merits)
STRASBOURG
18
January 2011
FINAL
18/04/2011
This
judgment has become final under Article 44 § 2 of the
Convention. It may be subject to editorial revision.
In the case of MGN Limited v. the United Kingdom,
The European Court of Human Rights (Fourth Section), sitting as a
Chamber composed of:
Ljiljana
Mijović,
President,
Nicolas
Bratza,
David
Thór Björgvinsson,
Päivi
Hirvelä,
Ledi
Bianku,
Nebojša
Vučinić,
Vincent
A. de Gaetano,
judges,
and Fatoş Aracı,
Deputy Section
Registrar,
Having
deliberated in private on 14 December 2010,
Delivers the following judgment, which was adopted on that date:
PROCEDURE
The case originated in an application (no. 39401/04)
against the United Kingdom of Great Britain and Northern Ireland
lodged with the Court under Article 34 of the Convention for the
Protection of Human Rights and Fundamental Freedoms (“the
Convention”) by a British company, MGN Limited (“the
applicant”), on 18 October 2004.
The applicant was represented by Mr K. Bays of
Davenport Lyons, a lawyer practising in London, assisted by Mr D.
Pannick QC, Mr K. Starmer QC and Mr A. Hudson, Counsel. The United
Kingdom Government (“the Government”) were represented by
their Agent, Ms H. Upton.
The applicant alleged two violations of its right to
freedom of expression guaranteed by Article 10 of the Convention. In
particular, it complained about a finding of breach of confidence
against it and, further, about being required to pay the claimants'
costs including success fees.
The Government filed written observations (Rule 59 §
1) on the merits and on the third parties' comments (Rule 44 § 6
and see immediately hereafter) and the applicant responded thereto
making also its claims for just satisfaction, to which submissions
the Government further responded. Combined third-party comments were
received from the Open Society Justice Initiative, the Media Legal
Defence Initiative, Index on Censorship, the English PEN, Global
Witness and Human Rights Watch, which had been given leave by the
President to intervene in the written procedure (Article 36 § 2
of the Convention and Rule 44 § 3). The Chamber decided, after
consulting the parties, that no hearing on the merits was required
(Rule 59 § 3 in fine).
THE FACTS
I THE CIRCUMSTANCES OF THE CASE
The
applicant is the publisher of a national daily newspaper in the
United Kingdom known as The Daily Mirror (formerly known as
the Mirror). It is represented before the Court by Mr K. Bays
of Davenport Lyons, a solicitor practising in London.
A. The relevant publications
On 1 February 2001 the “Mirror”
newspaper carried on the front page an article headed “Naomi:
I am a drug addict”, placed between two colour photographs
of Ms Naomi Campbell, a well-known model. The first photograph,
slightly indistinct, showed her dressed in a baseball cap and had a
caption: “Therapy: Naomi outside meeting”. The
second showed her glamorously partially covered by a string of beads.
The article read as follows:
“Supermodel Naomi Campbell is attending Narcotics
Anonymous meetings in a courageous bid to beat her addiction to drink
and drugs.
The 30-year old has been a regular at counselling
sessions for three months, often attending twice a day.
Dressed in jeans and baseball cap, she arrived at one of
NA's lunchtime meetings this week. Hours later at a different venue
she made a low-key entrance to a women-only gathering of recovered
addicts.
Despite her £14million fortune Naomi is treated as
just another addict trying to put her life back together. A source
close to her said last night: 'She wants to clean up her life for
good. She went into modelling when she was very young and it is easy
to be led astray. Drink and drugs are unfortunately widely available
in the fashion world. But Naomi has realised she has a problem and
has bravely vowed to do something about it. Everyone wishes her
well.'
Her spokeswoman at Elite Models declined to comment.”
The story continued inside the newspaper with a longer
article across two pages. This article was headed “Naomi's
finally trying to beat the demons that have been haunting her”
and the opening paragraphs read:
“She's just another face in the crowd, but the
gleaming smile is unmistakeably Naomi Campbell's. In our picture, the
catwalk queen emerges from a gruelling two-hour session at Narcotics
Anonymous and gives a friend a loving hug.
This is one of the world's most beautiful women facing
up to her drink and drugs addiction - and clearly winning.
The London-born supermodel has been going to NA meetings
for the past three months as she tries to change her wild lifestyle.
Such is her commitment to conquering her problem that
she regularly goes twice a day to group counselling ...
To the rest of the group she is simply Naomi, the
addict. Not the supermodel. Not the style icon.”
The article made mention of Ms Campbell's efforts to
rehabilitate herself and that one of her friends had said that she
was still fragile but “getting healthy”. The article gave
a general description of Narcotics Anonymous (“NA”)
therapy and referred to some of Ms Campbell's recently publicised
activities including an occasion when she had been rushed to hospital
and had her stomach pumped: while she had claimed it was an allergic
reaction to antibiotics and that she had never had a drug problem,
the article noted that “those closest to her knew the truth”.
In the middle of the double page spread, between
several innocuous pictures of Ms Campbell, was a dominating picture
with a caption “Hugs: Naomi, dressed in jeans and baseball
hat, arrives for a lunchtime group meeting this week”. The
picture showed her in the street on the doorstep of a building as the
central figure in a small group. She was being embraced by two people
whose faces had been masked on the photograph. Standing on the
pavement was a board advertising a certain café. The
photograph had been taken by a free-lance photographer contracted by
the newspaper for that job. He took the photographs covertly while
concealed some distance away in a parked car.
On 1 February 2001 Ms Campbell's solicitor wrote to
the applicant stating that the article was a breach of
confidentiality and an invasion of privacy and requesting an
undertaking that it would not publish further confidential and/or
private information.
The newspaper responded with further articles.
On 5 February 2001 the newspaper published an article headed, in
large letters, “Pathetic”. Below was a photograph
of Ms Campbell over the caption “Help: Naomi leaves
Narcotics Anonymous meeting last week after receiving therapy in her
battle against illegal drugs”. This photograph was similar
to the street scene picture published on 1 February. The text of the
article was headed “After years of self-publicity and
illegal drug abuse, Naomi Campbell whinges about privacy”.
The article mentioned that “the Mirror revealed last week how
she is attending daily meetings of Narcotics Anonymous”.
Elsewhere in the same edition, an editorial, with the heading “No
hiding Naomi”, concluded with the words: “If Naomi
Campbell wants to live like a nun, let her join a nunnery. If she
wants the excitement of a show business life, she must accept what
comes with it”.
On 7 February 2001, the Mirror published, under the heading
“Fame on you, Ms Campbell”, a further article
mocking Ms Campbell's threatened proceedings, referring to the years
during which she thrust “her failed projects like the
nauseating book Swan and equally appalling record Love and
Tears down our throats”, stating that Ms Campbell was not
an artist and that she was “about as effective as a chocolate
soldier”, implying that her prior campaign against racism in
the fashion industry was self-serving publicity and that “the
problem is that Naomi doesn't actually “stand” for
anything. She can't sing, can't act, can't dance, and can't write.”
B. The substantive proceedings
1. High Court ([2002] EWHC 499 (QB))
Ms Campbell claimed damages for breach of confidence
and compensation under the Data Protection Act 1998. A claim for
aggravated damages was made mainly as regards the article of 7
February 2001. On 27 March 2002 the High Court (Morland J.)
upheld Ms Campbell's claim, following a hearing of 5 days.
He described Ms Campbell as an “internationally
renowned fashion model and celebrity”. The first issue was
whether there had been a breach of confidence and, in that respect,
Ms Campbell was required to prove three elements.
The first was that the details divulged by the article about her
attendance at NA meetings had the necessary quality of confidence
about them. Information to the effect that her treatment was regular
attendance at NA meetings was clearly confidential: the details were
obtained surreptitiously, assisted by covert photography when she was
engaged (deliberately “low key and drably dressed”) in
the private activity of therapy to advance her recovery from drug
addiction. Giving details of her therapy, including her regular
attendance at NA, was easily identifiable as private and disclosure
of that information would be highly offensive to a reasonable person
of ordinary sensibilities. There existed a private interest worthy of
protection.
Secondly, it was found that those details were imparted in
circumstances importing an obligation of confidence given the sources
of the information (either a fellow sufferer of drug addiction or one
of her staff).
Thirdly, and having heard evidence on the subject, she had
demonstrated that the publication was to her detriment and, notably,
the publication of her treatment with NA specifically had caused her
significant distress and was likely adversely to affect her
attendance/participation in therapy meetings.
The High Court considered these findings to be in
conformity with the judgment of the Court of Appeal in Douglas v
Hello! Ltd ([2001] QB 967 §164-168) which had held that
there was no watertight division between the concepts of privacy and
confidentiality and that the approach to the tort had to be informed
by the jurisprudence of Article 8 of the Convention. Citing Dudgeon
v. the United Kingdom (22 October 1981, Series A no. 45) it noted
that Convention jurisprudence acknowledged different degrees of
privacy: the more intimate the aspect of private life which was being
interfered with, the more serious the justification required.
The High Court adopted the approach of Lord Woolf CJ
in A v B plc ([2003] QB 195, see paragraph 88 below) as
regards, inter alia, the qualification of the right to freedom
of expression by the right to respect for private life guaranteed by
Article 8 of the Convention.
The
High Court considered at some length the extent to which Ms Campbell
had exposed herself and her private life to the media and, in light
of this, how to reconcile the demands of Articles 8 and 10. The High
Court considered that the applicant had been fully entitled to
publish in the public interest the facts of her drug addiction and
treatment as Ms Campbell had previously misled the public by denying
drug use. “She might have been
thought of and indeed she herself seemed to be a self-appointed role
model to young black women”. However, the High Court had to
protect a celebrity from publication of information about her private
life which had “the mark and badge of
confidentiality” and which she had chosen not to put in the
public domain unless, despite that breach of confidentiality and the
private nature of the information, publication was justifiable. The
balance of Article 8 and 10 rights involved in the present case
clearly called for a remedy for Ms Campbell as regards the
publication of the private material.
The High Court heard evidence from, inter alia,
Ms Campbell as to the impact on her of the publication. It concluded:
“Although I am satisfied that Miss Naomi Campbell
has established that she has suffered a significant amount of
distress and injury to feelings caused specifically by the
unjustified revelation of the details of her therapy with Narcotics
Anonymous, apart from that distress and injury to feelings she also
suffered a significant degree of distress and injury to feelings
caused by the entirely legitimate publication by the defendants of
her drug addiction and the fact of therapy about which she cannot
complain. In determining the extent of distress and injury to
feelings for which she is entitled to compensation, I must consider
her evidence with caution. She has shown herself to be over the years
lacking in frankness and veracity with the media and manipulative and
selective in what she has chosen to reveal about herself. I am
satisfied that she lied on oath [about certain facts]. Nevertheless I
am satisfied that she genuinely suffered distress and injury to
feelings caused by the unjustified publication and disclosure of
details of her therapy in the two articles of the 1st and 5th
February 2002 complained of. I assess damages or compensation in the
sum of £2500.”
As to her claim for aggravated damages (mainly the
article of 7 February 2001), the High Court found that a
newspaper faced with litigation was entitled to argue that a claim
against it should never have been made and that any complaint should
have been made to the Press Complaints Commission. Such assertions
could even be written in strong and colourful language and it was not
for the courts to censor bad taste. However, since the
article also “trashed her as a person” in a highly
offensive and hurtful manner, this entitled her to aggravated damages
in the sum of GBP 1000.
2. Court of Appeal ([2002] EWCA Civ 1373
On 14 October 2002 the Court of Appeal (Lord Phillips
of Worth Matravers MR, Chadwick and Keene LJJ) unanimously allowed
the newspaper's appeal. The hearing had lasted two and a half days.
The Court of Appeal noted that Ms Campbell was an
“internationally famous fashion model” who had courted,
rather than shunned, publicity in part to promote other ventures in
which she was involved. In interviews with the media she had
volunteered information about some aspects of her private life and
behaviour including limited details about her relationships. She had
gone out of her way to aver that, in contrast to many models, she did
not take drugs, stimulants or tranquillisers, but this was untrue.
As
to the impact of the Human Rights Act 1998 (“HRA”) on the
law of confidentiality, the court observed that it had to balance the
rights guaranteed by Articles 8 and 10 of the Convention, noting that
freedom of the media was a bastion of any democratic society.
As
to whether the information disclosed was confidential, the Court of
Appeal did not consider that the information that Ms Campbell was
receiving therapy from NA was to be equated with disclosure of
clinical details of medical treatment. Since it was legitimate to
publish the fact that she was a drug addict receiving treatment, it
was not particularly significant to add that the treatment consisted
of NA meetings which disclosure would not be offensive to a
reasonable reader of ordinary sensibilities. While a reader might
have found it offensive that obviously covert photographs had been
taken of her, that, of itself, had not been relied upon as a ground
of complaint. In addition, it was not easy to separate the distress
Ms Campbell must have felt at being identified as a drug addict in
treatment accompanied by covert photographs from any additional
distress resulting from disclosure of her attendance at NA meetings.
In short, it was not obvious that the peripheral disclosure of Ms
Campbell's attendance at NA meetings was of sufficient significance
as to justify the intervention of the court.
Relying on Fressoz and Roire v. France ([GC],
no. 29183/95, § 54, ECHR 1999 I), the Court of Appeal
considered that the photographs were a legitimate, if not an
essential, part of the journalistic package designed to demonstrate
that Ms Campbell had been deceiving the public when she said that she
did not take drugs and, provided that publication of particular
confidential information was justifiable in the public interest, the
journalist had to be given reasonable latitude as to the manner in
which that information was conveyed to the public or his Article 10
right to freedom of expression would be unnecessarily inhibited. The
publication of the photographs added little to Ms Campbell's case:
they illustrated and drew attention to the information that she was
receiving therapy from NA.
3. House of Lords ([2004] UKHL 22)
Following a hearing of 2 days, on 6 May 2004 the House
of Lords allowed Ms Campbell's appeal (Lord Hope of Craighead,
Baroness Hale of Richmond and Lord Carswell formed the majority,
Lords Nicholls of Birkenhead and Hoffman dissenting) and restored the
orders made by the High Court. They delivered separate and extensive
judgments.
(a) Lord Hope of Craighead
Lord
Hope began by noting the powerful international reputation of Ms
Campbell in the business of fashion modelling, which business was
conducted under the constant gaze of the media. He also noted her
“status as a celebrity”. He considered that the issues
were essentially questions of “fact and degree” which did
not raise any “new issues of principle”. In the present
case, where the publication concerned a drug addict requiring
treatment and, given the fact that disclosure of details concerning
that treatment together with publication of a covertly taken
photograph could endanger that treatment, the disclosure was of
private information.
The case gave rise to a competition between the rights
of free speech and privacy which were of equal value in a democratic
society. In balancing these rights, Lord Hope noted that the right to
privacy, which lay at the heart of an action for breach of
confidence, had to be balanced against the right of the media to
impart information to the public and that the latter right had, in
turn, to be balanced against the respect that must be given to
private life. There was nothing new about this in domestic law.
He examined in detail the latitude to be accorded to
journalists in deciding whether or not to publish information to
ensure credibility. He noted the principles set out in this respect
in this Court's case law (Observer and Guardian v. the United
Kingdom, 26 November 1991, § 59, Series A no. 216; Jersild
v. Denmark, 23 September 1994, § 31, Series A no. 298 and
Fressoz and Roire v. France [GC], no. 29183/95, § 54,
ECHR 1999 I).
Having examined the balancing exercise in the Jersild
and Fressoz cases, Lord Hope reiterated there was no doubt
that the choices made about the presentation of material that was
legitimate to convey to the public was pre-eminently an editorial
matter with which the court would not interfere. However, choices to
publish private material raised issues that were not simply about
presentation and editing. Accordingly, the public interest in
disclosure had to be balanced against the right of the individual to
respect for their private life: those decisions were open to review
by the court. The tests to be applied were familiar and were set down
in Convention jurisprudence. The rights guaranteed by Articles 8 and
10 had to be balanced against each other, any restriction of those
rights had to be subjected to very close scrutiny and neither Article
8 nor Article 10 had any pre-eminence over each other (as confirmed
by Resolution 1165 of the Parliamentary Assembly of the Council of
Europe (“PACE”), 1998).
As to the Article 10 rights involved, the essential
question was whether the means chosen
to limit Article 10 rights were “rational, fair and not
arbitrary and impair the right as minimally as is reasonably
possible”. In this respect, the relevant factors were,
on the one hand, the duty on the press to impart information and
ideas of public interest which the public has a right to receive
(Jersild v. Denmark, cited above) and the need to leave it to
journalists to decide what material had to be reproduced to ensure
credibility (Fressoz and Roire v. France cited above) and, on
the other hand, the degree of privacy to which Ms Campbell was
entitled as regards the details of her therapy under the law of
confidence. However, the right of the public to receive information
about the details of her treatment was of a much lower order than its
undoubted right to know that she was misleading the public when she
said that she did not take drugs since the former concerned an
intimate aspect of her private life (Dudgeon v. the United
Kingdom, 22 October 1981, § 52, Series A no. 45). While he
acknowledged the great importance of political expression and,
indeed, of freedom of expression (constituting one of the essential
foundations of a democratic society and one of the basic conditions
for its progress and the self-fulfilment of each individual, Tammer
v. Estonia, no. 41205/98, § 59, ECHR 2001 I), he
considered that no political or democratic values were at stake and
no pressing social had been identified (a contrario, Goodwin
v. the United Kingdom, 27 March 1996, § 40, Reports
1996 II).
As to the competing Article 8 rights, the potential
for harm by the disclosure was an important factor in the assessment
of the extent of the restriction that was needed to protect Ms
Campbell's right to privacy. From the point of Article 8, publication
of details of her treatment (that she was attending NA, for how long,
how frequently and at what times of day, the nature of her therapy,
the extent of her commitment to the process and the publication of
covertly taken photographs) had the potential to cause harm to her
and Lord Hope attached a good deal of weight to this factor. The fact
that she was a “celebrity” was not enough to deprive her
of her right to privacy. A margin of appreciation had be accorded to
a journalist but viewing details of treatment for drug addiction
merely “as background was to undervalue the importance that was
to be attached to the need, if Ms Campbell was to be protected, to
keep these details private”. It was hard to see any compelling
need for the public to know the name of the organisation that she was
attending for therapy or the details of that therapy. The decision to
publish these details suggested that greater weight was given to the
wish to publish a story that would attract interest rather than any
wish to maintain its credibility.
Lord Hope then considered the covert photographs. It
was true that, had he to consider the text of the articles only, he
would have been “inclined to regard the balance between these
rights as about even”, such was the effect of the margin of
appreciation that had to be, in a doubtful case, given to a
journalist. However, the text could not be separated from the
photographs as the captions clearly linked what might otherwise have
been anonymous and uninformative pictures to the main text. In
addition, the reasonable person of ordinary sensibilities would
regard publication of the covertly taken photographs, linked in that
way to the text, as adding greatly to the overall intrusion into Ms
Campbell's private life.
While photographs taken in a public place had to be considered, in
normal circumstances, one of the “ordinary
incidents of living in a free community”, the real issue was
whether publicising the photographs was offensive in the present
circumstances. He reviewed the case-law of the Court (including P.G.
and J.H. v. the United Kingdom,
no. 44787/98, § 57, ECHR 2001 IX and Peck
v United Kingdom,
no. 44647/98, § 62, ECHR 2003 I) and applied the reasoning
in the Peck case. Ms Campbell could not have complained if the
photographs had been taken to show a scene in a street by a passer-by
and later published simply as street scenes. However, the photographs
invaded Ms Campbell's privacy because they were taken deliberately,
in secret, with a view to their publication in conjunction with the
article and they focussed on the doorway of the building of her NA
meeting and they revealed clearly her face. The argument that the
publication of the photograph added credibility to the story had
little weight, since the reader only had the editor's word as to the
truth of Ms Campbell's attendance at a NA meeting. He continued:
“124. Any person in Miss Campbell's position,
assuming her to be of ordinary sensibilities but assuming also that
she had been photographed surreptitiously outside the place where she
been receiving therapy for drug addiction, would have known what they
were and would have been distressed on seeing the photographs. She
would have seen their publication, in conjunction with the article
which revealed what she had been doing when she was photographed and
other details about her engagement in the therapy, as a gross
interference with her right to respect for her private life. In my
opinion this additional element in the publication is more than
enough to outweigh the right to freedom of expression which the
defendants are asserting in this case.”
Lord Hope therefore concluded that, despite the weight
that had to be given to the right to freedom of expression that the
press needs if it is to play its role effectively, there was an
infringement of Ms Campbell's privacy which could not be justified.
(b) Baroness Hale of Richmond
Baroness
Hale observed that the examination of an action for breach of
confidence began from the “reasonable expectation of privacy”
test inquiring whether the person publishing the information knew or
ought to have known that there was a reasonable expectation that the
relevant information would be kept confidential. This was a threshold
test which brought the balancing exercise between the rights
guaranteed by Articles 8 and 10 of the Convention into play. Relying
also on the PACE Resolution 1165 (1998), she noted that neither right
took precedence over the other. The application of the
proportionality test, included in the structure of Articles 8 and
10, was much less straightforward when two Convention rights were in
play and, in this respect, she relied on the above-cited cases of
Jersild v Denmark, Fressoz and Roire v France
and Tammer v Estonia.
In
striking the balance in this case, she noted:
“143. ... Put crudely, it is a prima donna
celebrity against a celebrity-exploiting tabloid newspaper. Each in
their time has profited from the other. Both are assumed to be
grown-ups who know the score. On the one hand is the interest of a
woman who wants to give up her dependence on illegal and harmful
drugs and wants the peace and space in which to pursue the help which
she finds useful. On the other hand is a newspaper which wants to
keep its readers informed of the activities of celebrity figures, and
to expose their weaknesses, lies, evasions and hypocrisies. This sort
of story, especially if it has photographs attached, is just the sort
of thing that fills, sells and enhances the reputation of the
newspaper which gets it first. One reason why press freedom is so
important is that we need newspapers to sell in order to ensure that
we still have newspapers at all. It may be said that newspapers
should be allowed considerable latitude in their intrusions into
private grief so that they can maintain circulation and the rest of
us can then continue to enjoy the variety of newspapers and other
mass media which are available in this country. It may also be said
that newspaper editors often have to make their decisions at great
speed and in difficult circumstances, so that to expect too minute an
analysis of the position is in itself a restriction on their freedom
of expression.”
However, Baroness Hale considered it not to be a
trivial case and defined the particularly private nature of the
information the publication of which Ms Campbell contested. It
concerned the important issue of drug abuse and, consequently, her
physical and mental health. She underlined the importance of, as well
as the sensitivities and difficulties surrounding, treatment for
addiction and, notably, of the vital therapy to address an underlying
dependence on drugs. Moreover, the Court's jurisprudence had always
accepted that information about a person's health and treatment for
ill-health was both private and confidential (Z v. Finland, 25
February 1997, § 95, Reports 1997 I). While the
disclosed information may not have been in the same category as
clinical medical records, it amounted to the same information which
would be recorded by a doctor in such records namely, the presenting
problem of addiction to illegal drugs, the diagnosis and the
prescription of therapy. Baroness Hale therefore began her analysis
from the fact - which was common ground - that all information about
Ms Campbell's addiction and attendance at NA disclosed in the article
was both private and confidential because it related to an important
aspect of her physical and mental health and the treatment she was
receiving for it. It had also been received from an insider in breach
of confidence.
As to the nature of the freedom of expression being
asserted on the other side, Baroness Hale recalled the main forms of
expression which she recorded in descending order of importance:
political speech (which included revealing information about public
figures, especially those in elective office, which would otherwise
be private but was relevant to their participation in public life),
intellectual and educational expression as well as artistic
expression. However, Baroness Hale found it difficult to see the
contribution made by “pouring over the intimate details of a
fashion model's private life”. It was true that the editor had
chosen to run a sympathetic piece, listing Ms Campbell's faults and
follies and setting them in the context of her addiction and her even
more important efforts to overcome addiction and such publications
might well have a beneficial educational effect. However, such pieces
were normally run with the co-operation of those involved and Ms
Campbell had refused to be involved with the story. The editor,
nevertheless, considered that he was entitled to reveal this private
information without her consent because Ms Campbell had presented
herself to the public as someone who was not involved in drugs.
Baroness Hale questioned why, if a role model presented a stance on
drugs beneficial to society, it was so necessary to reveal that she
had “feet of clay”. However, she accepted that the
possession and use of illegal drugs was a criminal offence and was a
matter of serious public concern so that the press had to be free to
expose the truth and put the record straight.
However, while Ms Campbell's previous public denial of
drug use might have justified publication of the fact of her drug use
and of her treatment for drug addiction, it was not necessary to
publish any further information, especially if it might jeopardise
her continued treatment. That further information amounted to the
disclosure of details of her treatment with NA and Baroness Hale
considered that the articles thereby “contributed to the sense
of betrayal by someone close to her of which she spoke and which
destroyed the value of [NA] as a safe haven for her”.
Moreover, publishing the photographs contributed both
to the revelation and to the harm that it might do. By themselves,
the photographs were not objectionable. If the case concerned a
photograph of Ms Campbell going about her business in a public
street, there could have been no complaint. However, the accompanying
text made it plain that these photographs were different in that they
showed Ms Campbell outside a NA meeting in the company of some
persons undoubtedly part of the NA group and they showed the place
where the meeting took place, which would have been entirely
recognisable to anyone who knew the locality. Photographs by their
very nature added to the impact of the words in the articles as well
as to the information disclosed. The photographs also added to the
potential harm “by making her think that she was being followed
or betrayed, and deterring her from going back to the same place
again”.
Moreover, there was no need for the photographs to be
included in the articles for the editor to achieve his objective. The
editor had accepted that, even without the photographs, it would have
been a front page story. He had his basic information and he had his
quotes. He could have used other photographs of Ms Campbell to
illustrate the articles. While the photographs would have been useful
in proving the truth of the story had this been challenged, there was
no need to publish them for this purpose as the credibility of the
story with the public would stand or fall with the credibility of
stories of the Daily Mirror generally. Baroness Hale added, in this
context, that whether the articles were sympathetic or not was not
relevant since the way an editor “chose to present the
information he was entitled to reveal was entirely a matter for him”.
Finally, it was true that the weight to attach to
these various considerations was “a matter of fact and degree”.
Not every statement about a person's health would carry the badge of
confidentiality: that a public figure had a cold would not cause any
harm and private health information could be relevant to the capacity
of a public figure to do the job. However, in the present case the
health information was not harmless and, indeed, as the trial judge
had found, there was a risk that publication would do harm:
“... People trying to recover from drug addiction
need considerable dedication and commitment, along with constant
reinforcement from those around them. That is why organisations like
[NA] were set up and why they can do so much good. Blundering in when
matters are acknowledged to be at a 'fragile' stage may do great
harm.
158. The trial judge was well placed to assess these
matters. ... he was best placed to judge whether the additional
information and the photographs had added significantly both to the
distress and the potential harm. He accepted her evidence that it had
done so. He could also tell how serious an interference with press
freedom it would have been to publish the essential parts of the
story without the additional material and how difficult a decision
this would have been for an editor who had been told that it was a
medical matter and that it would be morally wrong to publish it.”
(c) Lord Carswell
Lord Carswell agreed with Lord Hope and Baroness Hale.
It was not in dispute that the information was of a private nature
and imparted in confidence to the applicant and that the applicant
was justified in publishing the facts of Ms Campbell's drug addiction
and that she was receiving treatment given her prior public lies
about her drug use. He also agreed with Lord Hope as to the
balancing of Articles 8 and 10 rights and, further, that in order to
justify limiting the Article 10 right to freedom of expression, the
restrictions imposed had to be rational, fair and not arbitrary, and
they must impair the right no more than necessary.
Having examined the weight to be attributed to
different relevant factors, he concluded that the publication of the
details of Ms Campbell's attendance at therapy by NA, highlighted by
the photographs printed which revealed where the treatment had taken
place, constituted a considerable intrusion into her private affairs
which was capable of causing and, on her evidence, did in fact cause
her, substantial distress. In her evidence, she said that she had not
gone back to the particular NA centre and that she had only attended
a few other NA meetings in the UK. It was thus clear, that the
publication created a risk of causing a significant setback to her
recovery.
He did not minimise the “the importance of
allowing a proper degree of journalistic margin to the press to deal
with a legitimate story in its own way, without imposing unnecessary
shackles on its freedom to publish detail and photographs which add
colour and conviction”, which factors were “part of the
legitimate function of a free press” and had to be given proper
weight. However, the balance came down in favour of Ms Campbell.
(d) Lord Nicholls of Birkenhead
Lord Nicholls began by noting that Ms Campbell was “a
celebrated fashion model”, that she was a “household
name, nationally and internationally” and that her face was
“instantly recognisable”. He noted that the development
of the common law (tort of breach of confidence) had been in harmony
with Articles 8 and 10 of the Convention so that the time had come to
recognise that the values enshrined in Articles 8 and 10 were now
part of the cause of action for breach of confidence (Lord Woolf CJ,
A v B plc [2003] QB 195, 202, § 4).
He
found that the reference to treatment at NA meetings was not private
information as it did no more than spell out and apply to Ms Campbell
common knowledge of how NA meetings were conducted.
However,
even if Ms Campbell's attendance at meetings was considered private,
her appeal was still ill-founded since:
“On the one hand, publication of this information
in the unusual circumstances of this case represents, at most, an
intrusion into Miss Campbell's private life to a comparatively minor
degree. On the other hand, non-publication of this information would
have robbed a legitimate and sympathetic newspaper story of attendant
detail which added colour and conviction. This information was
published in order to demonstrate Miss Campbell's commitment to
tackling her drug problem. The balance ought not to be held at a
point which would preclude, in this case, a degree of journalistic
latitude in respect of information published for this purpose.
It is at this point I respectfully consider [that the
High Court] fell into error. Having held that the details of Miss
Campbell's attendance at [NA] had the necessary quality of
confidentiality, the judge seems to have put nothing into the scales
under article 10 when striking the balance between articles 8 and 10.
This was a misdirection. The need to be free to disseminate
information regarding Miss Campbell's drug addiction is of a lower
order than the need for freedom to disseminate information on some
other subjects such as political information. The degree of latitude
reasonably to be accorded to journalists is correspondingly reduced,
but it is not excluded altogether.”
He observed that Ms Campbell's repeated public
assertions denying her drug addiction rendered legitimate the
publication of the facts that she was a drug addict and in treatment
had been legitimate. The additional impugned element that she was
attending NA meetings as a form of therapy was of such an
unremarkable and consequential nature that its disclosure had also
been legitimate. The same applied to information concerning how long
Ms Campbell was receiving such treatment given that the frequency and
nature of NA meetings was common knowledge. Hence, the intrusion into
Ms Campbell's private life was comparatively minor.
Lastly, and as to the photographs, Lord Nicholls
observed that she did not complain about the taking of the
photographs nor assert that the taking of the photographs was itself
an invasion of privacy, rather that the information conveyed by the
photographs was private. However, the particular photographs added
nothing of an essentially private nature: they conveyed no private
information beyond that discussed in the article and there was
nothing undignified about her appearance in them.
(e) Lord Hoffmann
Lord Hoffmann began his judgment by describing Ms
Campbell as “a public figure” and, further, a famous
fashion model who had lived by publicity. He noted that the judges of
the House of Lords were “divided as to the outcome of this
appeal” but the difference of opinion related to “a very
narrow point” concerning the unusual facts of the case. While
it was accepted that the publication of the facts of her addiction
and of her treatment was justified as there was sufficient public
interest given her previous public denials of drug use, the division
of opinion concerned “whether in doing so the newspaper went
too far in publishing associated facts about her private life”.
He continued:
“But the importance of this case lies in the
statements of general principle on the way in which the law should
strike a balance between the right to privacy and the right to
freedom of expression, on which the House is unanimous. The
principles are expressed in varying language but speaking for myself
I can see no significant differences.”
There being no automatic priority between Articles 8
and 10, the question to be addressed was the extent to which it was
necessary to qualify one right in order to protect the underlying
value protected by the other and the extent of the qualification
should be proportionate to the need. The only point of principle
arising was, where the essential part of the publication was
justified, should the newspaper be held liable whenever the judge
considered that it was not necessary to have published some of the
personal information or should the newspaper be allowed some margin
of choice in the way it chose to present the story (referring to
Fressoz and Roire v. France [GC], no. 29183/95, ECHR 1999 I).
In this respect, Lord Hoffman considered that it would
be:
“inconsistent with the approach which has been
taken by the courts in a number of recent landmark cases for a
newspaper to be held strictly liable for exceeding what a judge
considers to have been necessary. The practical exigencies of
journalism demand that some latitude must be given. Editorial
decisions have to be made quickly and with less information than is
available to a court which afterwards reviews the matter at leisure.
And if any margin is to be allowed, it seems to me strange to hold
the Mirror liable in damages for a decision which three experienced
judges in the Court of Appeal have held to be perfectly justified.”
Given
the relatively anodyne nature of the additional details, the Mirror
was entitled to a degree of latitude in respect of the way it chose
to present its legitimate story.
As
to the publication of photographs in particular, Lord Hoffman
observed that the fact that the pictures were taken without Ms
Campbell's consent did not amount to a wrongful invasion of privacy.
Moreover, the pictures did not reveal a situation of humiliation or
severe embarrassment (as in Peck v. the United Kingdom, no.
44647/98, ECHR 2003 I) and had not been taken by intrusion into
a private place. There was nothing demeaning or embarrassing about
the photographs. They added nothing to what was said in the text and
carried the message that the Mirror's story was true.
Accordingly, the decision to publish the pictures was within the
margin of editorial judgment to which the Mirror was entitled.
Although the trial judge found that the publication was likely to
affect her therapy, this had neither been pleaded before nor fully
explored by the trial judge.
The appeal was allowed, the High Court award was
restored. Ms Campbell's costs (of the appeals to the Court of Appeal
and to the House of Lords) were awarded against the applicant, the
amount to “be certified by the Clerk of Parliaments, if not
agreed between the parties ...”.
C. The proceedings concerning legal costs
Ms Campbell's solicitors served three bills of costs
on the applicant in the total sum of GBP 1,086, 295.47: GBP
377,070.07 for the High Court; GBP 114,755.40 for the Court of
Appeal; and GBP 594,470.00 for the House of Lords. The latter figure
comprised “base costs” of GBP 288,468, success fees of
GBP 279,981.35 as well as GBP 26,020.65 disbursements. In the
High Court and Court of Appeal, Ms Campbell's solicitors and counsel
had acted under an ordinary retainer. But the appeal to the House of
Lords was conducted pursuant to a Conditional Fee Agreement (“CFA”)
which provided that, if the appeal succeeded, solicitors and counsel
should be entitled to base costs as well as success fees amounting to
95% and 100% of their base costs, respectively.
1. Campbell v. MGN Limited [2005] UKHL 61
On 21 February 2005 the applicant appealed to the
House of Lords seeking a ruling that it should not be liable to pay
the success fees as, in the circumstances, such a liability was so
disproportionate as to infringe their right to freedom of expression
under Article 10 of the Convention. The applicant did not seek
thereby a declaration of incompatibility but argued that domestic law
regulating the recoverability of success fees should be read so as to
safeguard its rights under Article 10. On 26 May 2005 this appeal was
heard by the House of Lords.
On 2 August 2005 Ms Campbell's solicitors accepted the
applicant's offers to pay GBP 290,000 (High Court costs) and GBP
95,000 (Court of Appeal costs), both amounts being exclusive of
interest.
On 20 October 2005 the appeal was unanimously
dismissed. The House of Lords found that the existing CFA regime with
recoverable success fees was compatible with the Convention, but they
expressed some reservations about the impact of disproportionate
costs.
(a) Lord Hoffman
Lord Hoffmann observed that the deliberate policy of
the Access to Justice Act 1999 (“the 1999 Act”) was to
impose the cost of all CFA litigation upon unsuccessful defendants as
a class. Losing defendants were to be required to contribute to the
funds which would enable lawyers to take on other cases, which might
not be successful, but which would provide access to justice for
people who could not otherwise have afforded to sue. Therefore, the
policy shifted the burden of funding from the State to unsuccessful
defendants, which was a rational social and economic policy.
While he was concerned about the indirect effect of
the threat of a heavy costs liability on the newspapers' decisions to
publish information which ought to be published but which carried a
risk of legal action, he considered that a newspaper's right could be
restricted to protect the right of litigants under Article 6 to
access to a court.
The applicant maintained that recoverable success fees
were disproportionate on the basis of two flawed arguments. The first
was that the success fee was necessarily disproportionate as it was
more than (and up to twice as much as) the amount which, under the
ordinary assessment rules, would be considered reasonable and
proportionate. This was a flawed point as it confused two different
concepts of proportionality. The CPR on costs were concerned with
whether expenditure on litigation was proportionate to the amount at
stake, the interests of the parties, complexity of the issues and so
forth. However, Article 10 was concerned with whether a rule, which
required unsuccessful defendants, not only to pay the reasonable and
proportionate costs of their adversary in the litigation, but also to
contribute to the funding of other litigation through the payment of
success fees, was a proportionate measure, having regard to the
effect on Article 10 rights. The applicant did not “really deny
that in principle it is open to the legislature to choose to fund
access to justice in this way.”
The second argument of the applicant was to the effect
that it was unnecessary to give Ms Campbell access to a court because
she could have afforded to fund her own costs. However, it was
desirable to have a general rule to enable the scheme to work in a
practical and effective way and that concentration on the individual
case and the particularities of Ms Campbell's circumstances would
undermine that scheme. It was for this reason that the Court in James
and Others v the United Kingdom (21 February 1986, Series A
no. 98) considered that Parliament was entitled to pursue a social
policy of allowing long leaseholders of low-rated houses to acquire
their freeholds at concessionary rates, notwithstanding that the
scheme also applied to some rich tenants who needed no such
assistance. The success fee should not be disallowed simply on the
ground that the applicant's liability would be inconsistent with its
rights under Article 10. Thus, notwithstanding the need to examine
the balance on the facts of the individual case, Lord Hoffman
considered that the impracticality of requiring a means test and the
small number of individuals who could be said to have sufficient
resources to provide them with access to legal services entitled
Parliament to lay down a general rule that CFAs were open to
everyone. Success fees, as such, could not be disallowed simply on
the ground that the present applicant's liability would be
inconsistent with its rights under Article 10: the scheme was a
choice open to the legislature and there was no need for any
exclusion of cases such as the present one from the scope of CFAs or
to disallow success fees because the existing scheme was compatible.
However, Lord Hoffman did not wish to leave the case
without commenting on other problems which defamation litigation
under CFAs was currently causing and which had given rise to concern
that freedom of expression might be seriously inhibited. The judgment
of Eady J in Turcu v News Group Newspapers Ltd ([2005] EWHC 799) highlighted the significant temptation for media defendants to
settle cases early for purely commercial reasons, and without regard
to the true merits of any pleaded defence. This 'chilling effect' or
'ransom factor' inherent in the CFA system was a situation which
could not have arisen in the past and was very much a modern
development.
Lord Hoffman considered that the “blackmailing
effect” of such litigation arose from two factors: (a) the use
of CFAs by impecunious claimants who did not take out insurance to
protect themselves from having to pay the winning party's costs if
they lost; and (b) the conduct of the case by the claimant's
solicitors in a way which not only ran up substantial costs but
required the defendants to do so as well. Referring to a recent case
where this was particularly evident (King v Telegraph Group Ltd
[Practice Note] [2005] 1 WLR 2282), he continued:
“Faced with a free-spending claimant's solicitor
and being at risk not only as to liability but also as to twice the
claimant's costs, the defendant is faced with an arms race which
makes it particularly unfair for the claimant afterwards to justify
his conduct of the litigation on the ground that the defendant's own
costs were equally high”
Lord Hoffman endorsed the solution offered by the
Court of Appeal in the King case (a “cost-capping”
order at an early stage of the action). However, that was only a
palliative as it did not deal with the problem of a newspaper risking
substantial and irrecoverable costs. Smaller publishers might not be
able to afford to take a stand and neither capping costs at an early
stage nor assessing them later dealt with the threat of having to pay
the claimant's costs at a level which was, by definition, up to twice
the amount which would be reasonable and proportionate. While
the DCA Consultation Paper (paragraph 101 below) discussed the
problem, no legislative intervention had been proposed.
Lord Hoffman distinguished between personal injury
litigation and defamation proceedings. Personal injury litigation
comprised a large number of small claims and the liability insurers
were able to pass these costs on to their road user customers with
their own solvency not being threatened and the liability insurers
had considerable negotiating strength to dispute assessments of costs
and to hold up the cash flow of the claimants' solicitors so that
both sides therefore had good reasons for seeking a compromise. On
the other hand, in defamation cases the reasons for seeking a
compromise were much weaker: there was a small number of claims and
payment of relatively large sums of costs; some publishers might be
strong enough to absorb or insure against this but it had a serious
effect upon their financial position; and publishers did not have the
same negotiating strength as the liability insurers because there
were few assessments to be contested and disputing them involved
considerable additional costs.
While the objective of enabling people of modest means
to protect their reputations and privacy from powerful publishers was
a good one, Lord Hoffman considered that it might be that a
legislative solution would be needed for the scheme to comply with
Article 10 of the Convention.
(b) Lord Hope of Craighead
Lord
Hope agreed with Lord Hoffmann.
He
underlined the protection to the losing party contained in the CPR
and the Costs Practice Directions. Reasonableness
and proportionality tests were applied separately to base costs and
to the percentage uplift for success fees. However, the most relevant
question for a court in assessing the reasonableness of the
percentage uplift was “the risk that the client might or might
not be successful” (paragraph 11.8(l)(a) of the Costs Practice
Directions) and that “in evenly balanced cases a success fee of
100 per cent might well be thought not to be unreasonable”.
There
remained the question of proportionality. Other than providing that
the proportionality of base costs and success fees were to be
separately assessed, the Costs Practice Directions did not identify
any factors that might be relevant. However, it would be wrong to
conclude that this was an empty exercise as it was the “ultimate
controlling factor” to ensure access to the court by a claimant
to argue that her right to privacy under Article 8 was properly
balanced against the losing party's rights to freedom of speech under
Article 10. While the losing party would pay the success fee, any
reduction in the percentage increase would have to borne by the
successful party under the CFA: the interests of both sides had to be
weighed up in deciding whether the amount was proportionate.
(c) Lord Carswell
Lord
Carswell agreed with the opinions of Lord Hoffmann and Lord Hope.
While “there are many who regard the imbalance in the system
adopted in England and Wales as most unjust”, the regimen of
CFAs and recoverable success fees was “legislative policy which
the courts must accept”. As to whether recoverable success
fees, which undoubtedly constituted a “chill factor”,
were compatible with Article 10 and a proportionate way of dealing
with the issue of the funding of such litigation, it was not really
in dispute that the legislature could in principle adopt this method
of funding access to justice.
The present case turned on whether it was still
proportionate when the claimant was wealthy and not in need of the
support of a CFA. While it was rough justice, the requirement on
solicitors to means test clients before concluding a CFA was
unworkable. With some regret, the conclusion was clear. While Lord
Carswell was “far from convinced about the wisdom or justice of
the CFA system” as it was then constituted, “it had to be
accepted as legislative policy”. It had not been shown to be
incompatible with the Convention and the objections advanced by the
applicant could not be sustained.
(d) Lord Nicholls of Birkenhead and Baroness Hale of
Richmond
74. Lord Nicholls agreed with the preceding opinions. Baroness
Hale also agreed with Lord Hoffman. It was, for her, a separate
question whether a legislative solution might be needed to comply
with Article 10: this was a complex issue involving a delicate
balance between competing rights upon which she preferred to express
no opinion.
From the date of rejection of this second appeal, the
applicant was liable to pay 8% interest on the costs payable.
On 28 November 2005 an order for the costs of the
second appeal to the House of Lords was made against the applicant.
Ms Campbell therefore served an additional bill of costs of GBP
255,535.60. The bill included a success fee of 95% (GBP 85,095.78) in
respect of the solicitors' base costs, her counsel having not entered
into a CFA for this appeal.
2. Review by the Judicial Taxing Officers of the costs of
the second appeal to the House of Lords
The applicant then sought to challenge the
proportionality of the costs and success fees claimed in respect of
both appeals to the House of Lords. An assessment hearing was fixed
for 8 March 2006 before the Judicial Taxing Officers of the House of
Lords.
On 3 March 2006 the applicant agreed with Ms
Campbell's solicitors to pay the sum of GBP 350,000 in respect of the
costs claimed in relation to the first appeal, excluding interest and
including the success fee applicable to the first appeal. The
applicant considered it was unlikely to do better before the Taxing
Officers, it wished to avoid accruing interest (8% per day) and
further litigation on costs would lead to further costs and success
fees.
The hearing on 8 March 2006 (before two Judicial
Taxing Officers) therefore concerned the costs of the second appeal
only, the Taxing Officers noting that the applicant had settled the
costs of the first appeal, it “no doubt recognising the
inevitability of the position”. A number of preliminary
issues were decided by the Taxing Officers including the validity of
the CFA, the applicable success fee rate and the proportionality of
the base costs billed by Ms Campbell's representatives (and on which
that success fee would be calculated).
By judgment dated 8 March 2006 the Judicial Taxing
Officers found that, in these hard fought proceedings ultimately
decided by a split decision of the House of Lords, there was “no
doubt” that the success fees (95% and 100%) claimed in respect
of the first appeal to the House of Lords were appropriate having
regard to the first and second instance proceedings. Since the second
appeal to the House of Lords was part and parcel of the first and was
clearly contemplated by the parties when they entered into the CFA,
the second appeal was covered by the CFA and thus the same success
fee. The effect of this was, of course, that the applicant faced a
greatly increased bill of costs: however, the applicant lost this
issue in the second appeal to the House of Lords. A success fee of
95% for the second appeal to the House of Lords was therefore
approved. Relying on Rules 44.4 and 44.5 of the CPR as well as
paragraph 15.1 of the Costs Practice Directions as well as a
necessity test, the Taxing Officers reduced the hourly rates
chargeable by Ms Campbell's solicitors and counsel, thereby reducing
the base costs and, consequently, the success fee payable by the
applicant.
On 5 May 2006 the applicant appealed to the House of
Lords arguing that the Taxing Officers judgment was incorrect in so
far as those Officers considered that the success fee for the second
appeal could not be varied. On 28 June 2006 the House of Lords
refused leave to appeal.
On 5 July 2007 the applicant agreed to pay GBP 150,000
(inclusive of interest and assessment procedure costs) in settlement
of Ms Campbell's costs of the second appeal.
II. RELEVANT DOMESTIC LAW AND PRACTICE
A. Breach of confidence/misuse of private information
1. The Human Rights Act 1998 (“the HRA”)
Section 2(1) of the HRA provides that a
court or tribunal determining a question which has arisen in
connection with a Convention right must take into account, inter
alia, any judgment, decision,
declaration or advisory opinion of the European Court of Human
Rights.
Section 6(1) provides that it
is unlawful for a public authority to act in a way which is
incompatible with a Convention right. A public authority
includes a court (section 6(3)(a) of the HRA).
Section
12(4) provides that a court must have particular regard to the
importance of the Convention right to freedom of expression and,
where the proceedings relate to journalistic material, to (a) the
extent to which the material has, or is about to, become available to
the public, or it is, or would be, in the public interest for the
material to be published as well as to (b) any relevant privacy code.
2. The Press Complaints Commission Code of Practice (“The
PCC Code”)
The PCC Code provided, at the relevant time, as
follows:
“3. Privacy
i) Everyone is entitled to respect for his or
her private and family life, home, health and correspondence. A
publication will be expected to justify intrusions into any
individual's private life without consent.
ii) The use of long lens photography to take
pictures of people in private places without their consent is
unacceptable.
Note - Private places are public or private property
where there is a reasonable expectation of privacy
...
1. The public interest includes:
i) Detecting or exposing crime or a serious
misdemeanour.
ii) Protecting public health and safety.
iii) Preventing the public from being misled
by some statement or action of an individual or organisation. . . .”
3. Breach of Confidence and Article 8 of the Convention
Originally the tort of breach of confidence was
characterised by reference to an obligation of confidence which arose
whenever a person received information he knew or ought to have known
was fairly and reasonably confidential. More recently, the tort
developed through the case-law so as to extend to situations where
information, properly to be regarded as private information, has been
misused. In principle, such a claim arises where private information
has been wrongfully published and it is now well-recognised that this
form of the tort of breach of confidence encapsulates the values
enshrined in both Articles 8 and 10 of the Convention. The
guiding principle as to what comprises an individual's private
information is whether the individual had a reasonable expectation of
privacy as regards the information in issue.
Lord Woolf CJ held as follows, as regards the
balancing of the interests protected by Articles 8 and 10, in his
oft-cited judgment in the Court of Appeal in the case of A v B plc
([2003] QB 195):
“4......under section 6 of the 1998 [Human Rights]
Act, the court, as a public authority, is required not to act “in
a way which is incompatible with a Convention right”. The court
is able to achieve this by absorbing the rights which articles 8 and
10 protect into the long-established action for breach of confidence.
This involves giving a new strength and breadth to the action so that
it accommodates the requirements of those articles.
5. The court is assisted in achieving this because the
equitable origins of the action for breach of confidence mean that
historically the remedy for breach of confidence will only be granted
when it is equitable for this to happen. ...
6. The manner in which the two articles operate is
entirely different. Article 8 operates so as to extend the areas in
which an action for breach of confidence can provide protection for
privacy. It requires a generous approach to the situations in which
privacy is to be protected. Article 10 operates in the opposite
direction. This is because it protects freedom of expression and to
achieve this it is necessary to restrict the area in which remedies
are available for breaches of confidence. There is a tension between
the two articles which requires the court to hold the balance between
the conflicting interests they are designed to protect. This is not
an easy task but it can be achieved by the courts if, when holding
the balance, they attach proper weight to the important rights both
articles are designed to protect. Each article is qualified expressly
in a way which allows the interests under the other article to be
taken into account. ...
11(iv) ... Any interference with the press has to be
justified because it inevitably has some effect on the ability of the
press to perform its role in society. This is the position
irrespective of whether a particular publication is desirable in the
public interest. The existence of a free press is in itself desirable
and so any interference with it has to be justified. ...
(x) If there is an intrusion in a situation where a
person can reasonably expect his privacy to be respected then that
intrusion will be capable of giving rise to a liability in action for
breach of confidence unless the intrusion can be justified. ...
(xii) Where an individual is a public figure he is
entitled to have his privacy respected in the appropriate
circumstances. A public figure is entitled to a private life. The
individual, however, should recognise that because of his public
position he must expect and accept that his or her actions will be
more closely scrutinised by the media. Even trivial facts relating to
a public figure can be of great interest to readers and other
observers of the media. Conduct which in the case of a private
individual would not be the appropriate subject of comment can be the
proper subject of comment in the case of a public figure. The public
figure may hold a position where higher standards of conduct can be
rightly expected by the public. The public figure may be a role model
whose conduct could well be emulated by others. He may set the
fashion. The higher the profile of the individual concerned the more
likely that this will be the position. Whether you have courted
publicity or not you may be a legitimate subject of public attention.
If you have courted public attention then you have less ground to
object to the intrusion which follows. In many of these situations it
would be overstating the position to say that there is a public
interest in the information being published. It would be more
accurate to say that the public have an understandable and so a
legitimate interest in being told the information. If this is the
situation then it can be appropriately taken into account by a court
when deciding on which side of the line a case falls. The courts must
not ignore the fact that if newspapers do not publish information
which the public are interested in, there will be fewer newspapers
published, which will not be in the public interest. The same is true
in relation to other parts of the media. On the difficult issue of
finding the right balance, useful guidance of a general nature is
provided by the Council of Europe Resolution 1165 of 1998.
(xiii) In drawing up a balance sheet between the
respective interests of the parties courts should not act as censors
or arbiters of taste. This is the task of others.”
B. Costs, conditional fee arrangements (“CFA”) and
success fees
1. General
A successful party to litigation may only recover
costs if and to the extent that a Court so orders and such questions
are to be determined in accordance with the Civil Procedure Rules
1988 (“CPR”). The CPR referred to below are applicable to
proceedings before the House of Lords. The general rule is that the
unsuccessful party will be ordered to pay the costs of the successful
party (Rule 44.3(2) of the CPR).
Prior to 1995, the only means of funding litigation
(apart from legal aid) was to agree an ordinary retainer with a
lawyer. CFAs were introduced for a limited range of litigation
by section 58 of the Courts and Legal Services Act 1990 (“the
1990 Act”). A CFA is an agreement between a client and a legal
representative which provides for his fees and expenses, or any part
of them, to be payable only in specified circumstances (for example,
if successful). Further secondary legislation was necessary to allow
CFAs to be adopted. The Conditional Fee Agreements Order 1995 not
only brought into force CFAs but it extended the range of proceedings
for which CFAs could be concluded, that range being further extended
to cover all litigation apart from criminal and family proceedings by
the Conditional Fee Agreements Order 1998. This position was
relatively unchanged by the Access to Justice Act (“the 1999
Act”).
A CFA, even as initially introduced, could make
provision for the payment of a percentage uplift in fees (“success
fees”). A success fee provided that the amount of any fees to
which it applied (base costs) could be increased by a percentage in
specified circumstances (for example, if successful). Section 58(4)
of the 1990 Act provides that a success fee must, inter alia,
state the percentage by which the amount of the fees is to be
increased and the Conditional Fee Agreements Order 2000 specified the
maximum percentage uplift to be 100%.
The 1999 Act then inserted section 58A into the 1990
Act. This provided that an order for costs made by a court could
include the success fees payable under a CFA, so that the base costs,
as well as the success fees, could be recovered against an
unsuccessful party. The 1999 Act also made ATE (after the event)
Insurance premiums recoverable against a losing party.
The CPR regulate the making of costs orders and the
assessment of such costs including success fees (Rule 43.2(1)(a) of
the CPR).
Rule
44.3(1)-(9) sets out the general rules which govern the
court's discretion to make an order for costs against a party.
Rule 44.3A of the CPR provides that, at the conclusion of the
proceedings to which the CFA relates, the court may make a summary
assessment or order a detailed assessment of all or part
of the costs (including success fees).
Rule 44.4(2) provides that, where the amount of costs is to be
assessed on the standard basis, the court will only allow costs which
are proportionate to the matters in issue and that it will resolve
any doubt which it may have, as to whether costs were reasonably
incurred or reasonable and proportionate in amount, in favour of the
paying party.
Rule 44.5 provides that the court must have regard to all
circumstances in deciding whether costs, assessed on a standard
basis, were proportionately and reasonably incurred or were
proportionate and reasonable in amount. Such circumstances must
include the conduct of all the parties, the amount or value of any
money or property involved; the importance of the matter to all the
parties; the particular complexity of the matter or the difficulty or
novelty of the questions raised; the skill, effort, specialised
knowledge and responsibility involved; the time spent on the case;
and the place where and the circumstances in which work or any part
of it was done.
Costs
Practice Directions supplement the CPR.
Paragraph
11.5 of the Direction provides that in
deciding, on a standard basis of assessment, whether the costs are
reasonable and proportionate, the court will consider the amount of
any additional liability (including success fees) separately from the
base costs.
Paragraph 11.8 requires the Court to take into account, when deciding
whether the percentage uplift by which the success fee is calculated
is reasonable, all relevant factors and it provides examples of such
factors: the circumstances in which
the costs would be payable might or might not occur (including
whether the case would win); the legal representative's liability for
any disbursements; and any other methods of financing the costs
available to the receiving party.
Paragraph 11.9 provides as follows:
“A percentage increase will not be reduced simply
on the ground that, when added to the base costs which are reasonable
and (where relevant) proportionate, the total appears
disproportionate.”
A party to litigation who instructs lawyers pursuant
to a CFA may, but is under no obligation to, take out ATE Insurance.
2. Relevant domestic case law on CFAs and success fees
(a) Designers Guild Ltd v. Russell Williams
(Textiles) Ltd. (2003] 2 Costs LR 204.
96. Paragraph 27 of the Practice Directions
Applicable to Judicial Taxations in the House of Lords (adopted in
March 2007) provides that notification is to be given to the opposing
parties and to the Judicial Office as soon as practicable after a CFA
has been entered into, and that the Taxing Officers decide questions
of percentage uplift in accordance with the principles set out in the
above-cited case of Designers' Guild Limited.
This case was the first assessment of costs for an
appeal to the House of Lords involving CFAs. The appellant had been
successful at first instance, had lost (unanimously) in the Court of
Appeal and its appeal was allowed (unanimously) in the House of
Lords. On 31 March 2003 the Taxing Officers held:
“14. With regard to the solicitors' claim a
success fee of 100% is sought. [Counsel for the Appellant] produced
to us the opinion of Leading Counsel prior to the CFA being entered
into which put the chances of success at no more than evens. That
opinion was given against a background in which the appellant company
had been successful at first instance and lost in the Court of
Appeal. It is quite clear that the issues were finely balanced. It is
generally accepted that if the chances of success are no better than
50% the success fee should be 100%.
The thinking behind this is that if a solicitor were to
take two identical cases with a 60% chance of success in each it is
likely that one would be lost and the other won. Accordingly the
success fee (of 100%) in the winning case would enable the solicitor
to bear the loss of running the other case and losing.
15. There is an argument for saying that in any case
which reached trial a success fee of 100% is easily justified because
both sides presumably believed that they had an arguable and winnable
case. In this case we have no doubt at all that the matter was finely
balanced and that the appropriate success fee is therefore 100%”.
(b) Turcu v News Group Newspapers Ltd [2005] EWHC 799 (QB)
Eady J noted as follows:
“6. The claimant ... seeks a large award of
damages, including aggravated and exemplary damages, against the
proprietors of The News of the World .... He is able to pursue his
claim purely because [his legal representative] has been prepared to
act on his behalf on the basis of a [CFA]. This means, of course,
that significant costs can be run up for the defendant without any
prospect of recovery if they are successful, since one of the matters
on which [the legal representative] does apparently have instructions
is that his client is without funds. On the other hand, if the
defendant is unsuccessful it may be ordered to pay, quite apart from
any damages, the costs of the claimant's solicitors including a
substantial mark-up in respect of a success fee. The defendant's
position is thus wholly unenviable.
7. Faced with these circumstances, there must be a
significant temptation for media defendants to pay up something, to
be rid of litigation for purely commercial reasons, and without
regard to the true merits of any pleaded defence. This is the
so-called “chilling effect” or “ransom factor”
inherent in the conditional fee system, which was discussed by the
Court of Appeal in [King v Telegraph Group Ltd
[Practice Note] [2005] 1 WLR 2282]. This is a
situation which could not have arisen in the past and is very much a
modern development.”
(c) King v Telegraph Group Ltd [Practice Note]
[2005] 1 WLR 2282
This
claimant was without financial means and had no ATE insurance. Brooke
LJ noted the significant pre-action costs incurred by the claimant's
solicitors which required, in turn, costs to be incurred by the
defendant who also risked paying double the claimants' already
significant costs. He continued:
“What is in issue in this case, however, is the
appropriateness of arrangements whereby a defendant publisher will be
required to pay up to twice the reasonable and proportionate costs of
the claimant if he loses or concedes liability, and will almost
certainly have to bear his own costs (estimated in this case to be
about £400,000) if he wins. The obvious unfairness of such a
system is bound to have the chilling effect on a newspaper exercising
its right to freedom of expression ... and to lead to the danger of
self-imposed restraints on publication which he so much feared ....
It is not for this court to thwart the wish of
Parliament that litigants should be able to bring actions to
vindicate their reputations under a CFA, and that they should not be
obliged to obtain ATE cover before they do so. ... On the other hand,
we are obliged to read and give effect to relevant primary and
secondary legislation so far as possible in a way that is compatible
with a publisher's Article 10 Convention rights ....
In my judgment the only way to square the circle is to
say that when making any costs capping order the court should
prescribe a total amount of recoverable costs which will be
inclusive, so far as a CFA-funded party is concerned, of any
additional liability. It cannot be just to submit defendants in these
cases, where their right to freedom of expression is at stake, to a
costs regime where the costs they will have to pay if they lose are
neither reasonable nor proportionate and they have no reasonable
prospect of recovering their reasonable and proportionate costs if
they win.
If this means, ..., that it will not be open to a
CFA-assisted claimant to receive the benefit of an advocate
instructed at anything more than a modest fee or to receive the help
of a litigation partner in a very expensive firm who is not willing
to curtail his fees, then his/her fate will be no different from that
of a conventional legally aided litigant in modern times. It is rare
these days for such a litigant to be able to secure the services of
leading counsel unless the size of the likely award of compensation
justifies such an outlay, and defamation litigation does not open the
door to awards on that scale today. Similarly, if the introduction of
this novel cost-capping regime means that a claimant's lawyers may be
reluctant to accept instructions on a CFA basis unless they assess
the chances of success as significantly greater than evens (so that
the size of the success fee will be to that extent reduced), this in
my judgment will be a small price to pay in contrast to the price
that is potentially to be paid if the present state of affairs is
allowed to continue.”
3. Public consultation process on CFAs and success fees including
the “Review of Civil Litigation Costs: Final Report”, of
Jackson LJ, January 2010 (“the Jackson Review”)
(a) Consultation prior to the Jackson Review
In 2003 a Consultation Paper entitled “Simplifying
CFAs” was completed by the Department of Constitutional Affairs
(“DCA”, whose powers were transferred to the Ministry of
Justice in May 2007). The use of CFAs in defamation proceedings
emerged as a controversial issue during this consultation. Several
national and regional media organisations took the opportunity to
raise a number of concerns about the impact of the use of CFAs in
defamation proceedings. Media organisations claimed that CFAs
inhibited the right to freedom of expression and encouraged
unmeritorious claims. Claimants' lawyers felt that the use of CFAs in
defamation proceedings had greatly widened access to justice and
placed claimants on an equal footing with their opponents.
In the 2004 Consultation Paper “Making Simple
CFAs a reality” of the DCA, media organisations reiterated the
view that CFAs needed to be controlled in defamation proceedings.
They stressed that funding these cases by CFAs (particularly where
the claimant had significant personal wealth) impinged on the media's
right to freedom of expression because the success fee could
effectively double a claimant lawyer's cost. This resulted in the
“ransom” or “chilling effect” that forced the
media to settle claims they might otherwise fight due to excessive
costs. The media also expressed concerns there was no true ATE
insurance market (because the very small number of cases did not
ensure a competitive market), and about the failure of the costs
judges to effectively control CFA costs in defamation proceedings.
While the focus of the Consultation Paper had been defamation
proceedings, the same problems applied in other publication cases.
The 2004 Paper also noted that claimants' lawyers, on the other hand,
believed that CFAs provided access to justice for all in an area of
law where many would otherwise not be able to afford to seek redress.
They also made the point that CFAs played an important role in
discouraging irresponsible journalism. The sharp decline in the
number of claims issued in this area, after the introduction of CFAs
in defamation proceedings, indicated that lawyers were being more
cautious when advising clients who were considering litigation. They
believed that CFAs should not be banned or restricted in this area of
law, but that success fees should be staged – 100% for cases
going to trial and less for cases that settled early.
The DCA concluded that legislation to restrict the use of success
fees in this area (publication proceedings) was not planned. The DCA
supported the initiative launched by the Civil Justice Council
(“CJC”) to mediate a general agreement on success fees in
this area of law and considered that the existing powers of the
courts were sufficient to control costs.
The above-cited judgment in King and the 2004
consultation prompted media organisations and claimants' lawyer
groups to try to reach an agreement on the way forward. Following the
CFA round table hosted by the DCA in July 2004, both sides approached
the CJC to mediate.
In April 2005 a previous Lord Chancellor spoke about
CFAs and costs at a media society event. He called for proper control
and proportionality in the costs-risks attached to publication
litigation and urged claimant and media lawyers to try to find a
solution through discussion.
In March 2006 the House of Commons Constitutional
Affairs Select Committee considered the role of CFAs in defamation
and privacy proceedings as part of its inquiry on the “Compensation
Culture”. It felt that courts could address disproportionate
costs through appropriate cost control measures such as cost-capping
and that it might be appropriate for lawyers to re-assess risk (and
therefore the amount of uplift) as the case progressed (staged
success fees). No concrete action was taken.
From 2006 to 2007 the CJC hosted a number of forums
including representatives from the media, legal profession and
insurance. This mediation, having been suspended pending the second
appeal in the present case to the House of Lords, concluded with the
production of a model agreement (“the Theobalds Park Plus
Agreement”) which set out a range of solutions including a
range of staged success fees.
The Ministry of Justice agreed with the CJC's
recommendations that the Theobalds Park Plus model agreement was
workable and could help ensure that costs of litigation were
proportionate and reasonable. The Ministry of Justice decided to
consult on the issue. Through its Consultation Paper of August
2007 entitled “Conditional fee agreements in defamation
proceedings: Success Fees and After the Event Insurance”, the
Ministry of Justice sought views on the implementation of the CJC's
recommendations in publication proceedings and, notably, on a range
of fixed staged recoverable success fees and on the recoverability of
ATE insurance premiums. A slightly revised scheme was published with
responses to the consultation in July 2008. Some responses to the
consultation supported in principle the introduction of fixed
recoverable staged success fees and ATE insurance premiums; however,
there was no consensus on the details of the scheme. The media in
particular did not support the scheme and strongly opposed its
implementation and called for additional measures to address
disproportionate and unreasonable costs in CFA cases. The scheme was
not implemented.
On 24 February 2009 the Ministry of Justice published
further a Consultation Paper on “Controlling costs in
defamation proceedings”. The high levels of legal costs in
defamation and some other publication related proceedings had been
the subject of criticism and debate in the courts and Parliament.
“Excessive costs may force defendants to settle unmeritorious
claims, which in turn threatens a more risk averse approach to
reporting and some argue is a risk to freedom of expression”.
While the Government had previously consulted on proposals for a
scheme of staged recoverable success fees and after the event
insurance (ATE) premiums in publication proceedings to reduce
unreasonable and disproportionate costs, a number of media
organisations suggested additional measures that they considered
necessary if costs in this area were to be maintained at reasonable
levels. The Consultation Paper therefore sought views on measures to
better control costs notably through limiting recoverable hourly
rates; costs-capping; and requiring the proportionality of total
costs to be considered on costs assessments conducted by the court.
As regards the question (no 6) of whether the courts
should apply the proportionality test to total costs not just base
costs, the Consultation Paper noted that the Government
considered that “a requirement to consider the proportionality
of total costs would be a helpful tool in controlling costs in
defamation proceedings”. They would request the CPR Committee
to consider amendments to the CPR and to the related practice
direction.
As to the scope of the proposals, the Consultation
Paper assumed that as a minimum the provisions would be introduced
for defamation disputes (libel and slander) because it was
principally in these cases that the key problems were seen to arise.
However, the Paper added that there were other causes of action (such
as breach of privacy) where “it may be considered they should
also apply”.
The Consultation Paper with the responses and
proposals received was published on 24 September 2009. The CPR
Committee, requested to consider a number of measures to control
costs in publication proceedings, proposed draft rules concerning,
inter alia, additional information and control of ATE
insurance. The Civil Procedure (Amendment) Rules 2009 came into force
on 1 October 2009. The Government preferred to leave other matters
open pending the Jackson Review.
(b) The Jackson Review, January 2010
In late 2008 Jackson LJ was appointed to conduct a
fundamental review of the rules and principles governing the costs of
civil litigation and to make recommendations in order to promote
access to justice at proportionate cost.
In January 2010 the Jackson Review was published,
running to almost 600 pages plus appendices. In relation to CFAs, it
noted that England and Wales differed from all other jurisdictions in
having success fees payable not by the lawyer's own client but by the
losing party. The benefits of CFAs had been achieved at massive cost
especially in cases which were fully contested. That cost was borne
by tax payers, insurance premium payers and by those defendants who
had the misfortune of being neither insured nor a large,
well-resourced organisation.
While Jackson LJ concluded that CFAs were not
objectionable in themselves, he considered that there were four flaws
in allowing success fees to be recovered from the losing party:
“4.7 The recoverability regime does not possess
either of the two crucial features of the legal aid regime which it
replaces. In my view these omissions are two of its flaws. The third
flaw is that the burden placed upon opposing parties is simply too
great. The fourth flaw is that it presents an opportunity for some
lawyers to make excessive profits. The consequence of these four
flaws is to generate disproportionate costs.
(a) First flaw
4.8 Any person, whether rich or poor and whether human
or corporate, is entitled to enter into a CFA and take out ATE
insurance. All that such a person needs to do is to find willing
solicitors and willing insurers. This gives rise to anomalies and
unintended consequences on a grand scale. I will give three examples
in the next three paragraphs.
4.9 The tree root claims. It is, in my view, absurd that
insurance companies can bring claims against local authorities using
CFAs ... thereby doubling the costs burden upon council tax payers.
The insurance companies can well afford to fund such litigation
themselves and should do so.
4.10 Commercial claims. It is also, in my view, absurd
that one party to commercial litigation can become a
“super-claimant”... and thereby transfer most of the
costs burden to the other party. Two arguments have been pressed upon
me by defenders of recoverability in such cases: first, that
recoverability enables [small and medium enterprises (“SMEs”)]
to take on larger companies; secondly that the opposing party can
avoid the crushing costs burden by settling early. As to the first
argument, the recoverability provisions are of universal application.
They are just as likely to be used by a large company against an SME
as vice versa. As to the second argument ... some business disputes
are evenly balanced. It is perfectly reasonable for the companies on
both sides to decide to fight. It is quite wrong for one or other
party to be pressurised into settling by a gross imbalance in the
costs liabilities of the parties. If party A has a CFA... and party B
does not, party A may be litigating at virtually no costs risk,
whereas party B may face liability for quadruple costs if it loses.
4.11 Consumer dispute. County court litigation sometimes
involves disputes between suppliers of goods and customers or
consumers. Where such litigation is above the level of the small
claims track, it is not unknown for the supplier to have a CFA and
for the individual on the other side not to have a CFA. It all
depends upon the terms which each party manages to agree with its own
solicitors. In some cases the recoverability regime will give the
consumer a “free ride” against the supplier. In other
cases it will have precisely the opposite effect. It is perfectly
possible for the recoverability regime to give the supplier a free
ride and to expose the consumer to a massively increased costs
liability.
4.12 The first flaw in the recoverability regime is that
it is unfocused. There is no eligibility test for entering into a
CFA, provided that a willing solicitor can be found.
(b) Second flaw
4.13 The second flaw is that the party with a CFA
generally has no interest in the level of costs being incurred in his
or her name. Whether the case is won or lost, the client will usually
pay nothing. If the case is lost, the solicitors waive their costs
and pay the disbursements, in so far as not covered by ATE insurance.
If the case is won, the lawyers will recover whatever they can from
the other side either (a) by detailed or summary assessment or (b) by
negotiation based upon the likely outcome of such an assessment.
4.14 This circumstance means that the client exerts no
control (or, in the case of a no win, low fee agreement, little
control) over costs when they are being incurred. The entire burden
falls upon the judge who assesses costs retrospectively at the end of
the case, when it is too late to “control” what is spent.
(c) Third flaw
4.15 The third flaw in the recoverability regime is that
the costs burden placed upon opposing parties is excessive and
sometimes amounts to a denial of justice. If one takes any large
block of cases conducted on CFAs, the opposing parties will end up
paying more than the total costs of both parties in every case,
regardless of the outcome of any particular case.
4.16 If the opposing party contests a case to trial
(possibly quite reasonably) and then loses, its costs liability
becomes grossly disproportionate. Indeed the costs consequences of
the recoverability rules can be so extreme as to drive opposing
parties to settle at an early stage, despite having good prospects of
a successful defence. This effect is sometimes described as
“blackmail”, even though the claimant is using the
recoverability rules in a perfectly lawful way.
(d) Fourth flaw
4.17 If claimant solicitors and counsel are successful
in only picking “winners”, they will substantially
enlarge their earnings... As the Senior Costs Judge explained... it
is not possible for costs judges effectively to control success fees
retrospectively.
4.18 Of course, not all lawyers are good at picking
winners and some suffer losses on that account. Nevertheless, one
repeated criticism of the recoverability regime which I have heard
throughout the Costs Review, is that some claimant lawyers “cherry
pick”. In other words they generally conduct winning cases on
CFAs, they reject or drop at an early stage less promising cases and
thus generate extremely healthy profits. Obviously the financial
records of individual solicitors firms and barristers are
confidential. Moreover, even if one such set of accounts were made
public, that would tell us nothing about all the others.
Nevertheless, the one point that can be made about the CFA regime is
that it presents the opportunity
to cherry pick. If lawyers succumb to that temptation, they will
greatly increase their own earnings and they will do so in a manner
which is entirely lawful.
4.19 Having worked in the legal profession for 37 years,
I have a high regard for my fellow lawyers, both solicitors and
counsel. The fact remains, however, that lawyers are human. As
Professor Adrian Zuckerman has forcefully pointed out both during the
Woolf Inquiry and during the present Costs Review, work tends to
follow the most remunerative path. In my view, it is a flaw of the
recoverability regime that it presents an opportunity to lawyers
substantially to increase their earnings by cherry picking. This is a
feature which tends to demean the profession in the eyes of the
public.”
Specifically in relation to defamation and related
claims, Jackson LJ considered that the present system was “the
most bizarre and expensive system that it is possible to devise”
for the following three reasons:
“(i) Defendants pay a heavy price in order to
ensure (a) that claimants within the CFA regime are protected against
adverse costs liability and (b) that defendants can still recover
costs if they win.
(ii) Despite paying out large ATE insurance premiums in
cases which they lose, the defendants' costs recovery in cases which
they win may be only partial. This is because the defendants' costs
recovery will be subject to the policy limits agreed by claimants in
those cases.
(iii) The present regime of recoverable ATE insurance
premiums is indiscriminating. A wealthy celebrity suing a hard
pressed regional newspaper publisher is fully entitled to take out
ATE insurance, effectively at the expense of the defendant. The
present regime provides protection against adverse costs, but it is
in no way targeted upon those claimants who need such protection.”
As to defamation and related proceedings, Jackson LJ
noted that a principal concern that had been expressed in relation to
the costs of defamation proceedings and privacy cases was the
widespread use of CFAs with ATE insurance, which could impose a
disproportionate costs burden on defendants. He had recommended, for
all civil litigation, a return to CFAs whose success fees and ATE
premiums were not recoverable from the losing party (the pre-1999 Act
position): those arrangements had not suffered from the above flaws
but opened up access to justice for many individuals who formerly had
no such access.
If that recommendation were to be adopted, Jackson LJ considered that
it should go a substantial distance to ensuring that unsuccessful
defendants in such proceedings were not faced with a disproportionate
costs liability. However, such a measure could also reduce
access to justice for claimants of slender means. To overcome this
latter potential problem, he recommended complementary measures for
defamation and related proceedings including increasing the general
level of damages in defamation and breach of privacy proceedings by
10% and introducing a regime of qualified one way costs shifting,
under which the amount of costs that an unsuccessful claimant may be
ordered to pay was a reasonable amount, reflective of the means of
the parties and their conduct in the proceedings.
(c) Consultation subsequent to the “Jackson
Review”
(i) Report of the House of Commons Culture, Media and
Sport Committee entitled “Press standards, privacy and libel”,
24 February 2010
In its introduction, the Report noted:
“Throughout our inquiry we have been mindful of
the over-arching concerns about the costs of mounting and defending
libel actions, and the 'chilling effect' this may have on press
freedom. The evidence we have heard leaves us in no doubt that there
are problems which urgently need to be addressed in order to enable
defamation litigation costs to be controlled more effectively. We
find the suggestion that the problem confronting defendants,
including media defendants, who wish to control their costs can be
solved by settling cases more promptly to be an extraordinary one. If
a defendant is in the right, he should not be forced into a
settlement which entails him sacrificing justice on the grounds of
cost.
All the evidence which we have received points to the
fact that the vast majority of cases brought under a Conditional Fee
Agreement (CFA) are won. We therefore see no justification for
lawyers to continue to demand 100% success fees which are chargeable
to the losing party. We recommend that the recovery of success fees
from the losing party should be limited to no more than 10%, leaving
the balance to be agreed between solicitor and client. We further
recommend that the Government should make After the Event Insurance
premiums irrecoverable.”
As regards, in particular, costs in defamation
litigation, it commented:
“263. We are aware that machinery exists for
defendants to protect their position as to costs by making a payment
into court. It does not appear to us that this machinery effectively
protects a defendant, who genuinely attempts to settle a claim at an
early stage, against a determined and deep-pocketed litigant. This is
another issue which needs to be addressed by the Ministry of Justice.
...
292. Although some have suggested that CFAs should be
means-tested, in practice, given the high costs involved, this would
be likely to result in access to justice being limited to the
extremely poor and the super rich. The complexities involved also do
not lend themselves to a simple or proportionate solution. We
therefore do not support the introduction of means-testing CFAs. ...
294. In the matter of success fees, the argument is made
that they need to be high to compensate for the risks run by lawyers
.... This view is not, however, supported by the data available on
the outcomes of cases of this kind. This data suggests that
CFA-funded parties win the vast majority of their cases. ...
295. This high success rate is no doubt in part the
fruit of careful selection. Indeed common sense and the economic
incentives would point to the inevitability of cherry-picking. ...
307. All the evidence we have heard leads us to conclude
that costs in CFA cases are too high. We also believe that CFA cases
are rarely lost, thereby undermining the reasons for the introduction
of the present scheme. However it is vital to the maintenance of
press standards that access to justice for those who have been
defamed is preserved. We do not agree with the Ministry of Justice
that the maximum level of success fees should be capped at 10%, nor
do we believe that success fees should become wholly irrecoverable
from the losing party. However we would support the recoverability of
such fees from the losing party being limited to 10% of costs leaving
the balance to be agreed between solicitor and client. This would
address the key issue and seems to us to provide a reasonable
balance, protecting access to justice, adequately compensating
solicitors for the risks taken, giving claimants and their lawyers,
in particular, a strong incentive to control costs and ensuring that
costs to a losing party are proportionate. ...
309. ... Just as the press must be accountable for what
it writes, lawyers must be accountable for the way in which cases are
run, and that includes costs. The current costs system, especially
the operation of CFAs, offers little incentive for either lawyers or
their clients to control costs, rather the contrary. It also leads to
claims being settled where they lack merit. We hope that the combined
effect of our recommendations, the Ministry of Justice consultations
and the conclusions of Lord Justice Jackson, will provide the impetus
for a fairer and more balanced approach to costs in publication
proceedings.”
(ii) “Controlling Costs in Defamation
Proceedings – Reducing Conditional Fee Agreement Success Fees”
(“The 2010 Consultation Paper”): CP1/2010
118. In January 2010 the Ministry of Justice launched a further
public consultation with the above-noted Paper. It considered only
the option of reducing the maximum uplift in defamation cases to 10%
pending consideration of the other recommendations of the Jackson
Review (the reference here to defamation including other publication
cases). The executive summary of the Consultation Paper reads as
follows:
“The Government has for some time been concerned
about the impact of high legal costs in defamation proceedings,
particularly the impact of 100% success fees, which can double the
costs to unsuccessful defendants in cases funded under conditional
fee agreements (CFAs).
CFAs have increased access to justice for claimants in
making it more possible to bring cases. However, the experience over
the past decade suggests that - in defamation proceedings in
particular - the balance has swung too far in favour of the interests
of claimants, and against the interests of defendants. The current
arrangements appear to permit lawyers acting under a CFA to charge a
success fee that is out of proportion to the risks involved. Aside
from the cost burden this places on the opposing side, this could
encourage weaker and more speculative claims to be pursued.
The Government does not believe that the present maximum
success fee in defamation proceedings is justifiable in the public
interest. This is particularly the case because the evidence shows
that many more defamation claims win than would substantiate such a
generous success fee. This view is supported by Sir Rupert Jackson's
report ...
This consultation paper seeks views on a proposal to
reduce the maximum success fee which lawyers can currently charge
from 100% to 10% of the base costs. This is an interim measure for
dealing with disproportionate costs while the Government considers
Sir Rupert's wider proposals which seek to radically change the
existing arrangements for all cases where CFAs are used. The proposal
in this consultation paper would help reduce the costs for media
defendants further and limit the potential harmful effect very high
legal costs appear to have on the publication decisions of the media
and others.
This proposed change is intended to complement changes
already introduced on 1 October 2009 in respect of defamation
proceedings which were designed to control the costs of individual
cases.”
The Ministry of Justice Consultation Paper of 3 March
2010 included the responses and its conclusions. It concluded as
follows:
“2. The Government has had particular concerns
about the high costs in defamation cases. Defamation is a discrete
area where we have already taken a number of steps to help control
costs. Defamation proceedings are now part of a mandatory costs
budgeting pilot, with Judges scrutinising costs as cases progress.
3. Lord Justice Jackson in his report ... recommends the
abolition of recoverability of success fees and after the event (ATE)
insurance premiums across civil litigation. Sir Rupert's report is
substantial with recommendations that are far reaching with
potentially widespread impact on many areas. However, it sets out a
clear case for CFA reform. Even those respondents who did not support
our proposal of reducing defamation success fees to 10% agree that
the status quo cannot be permitted to continue. The main flaw
identified by Sir Rupert of the current regime is the costs burden
placed upon the opposing side. He also points out that the CFA regime
was working satisfactorily before recoverability of success fees and
ATE was introduced – an assertion that is made by a large
number of respondents to the consultation.
4. Previous attempts to control the success fees have
proved unfruitful. For example during 2007 the Department published a
consultation paper, Conditional fee agreements in defamation
proceedings: Success Fees and After the Event Insurance, on a scheme
of fixed recoverable staged success fees and ATE insurance premiums.
However, there was no consensus on the details of the scheme and it
could not be implemented. No new evidence was provided to Sir Rupert
against his recommendation on abolishing recoverability of success
fees and ATE.
5. We carefully considered all the responses. More than
half (53%) of those who responded agreed with our proposal to reduce
the defamation success fees to 10%. The Government also considered
the report from the Culture Media and Sport Committee on press
freedom libel and privacy published on 25 February 2010. Although the
Committee did not agree with our proposal it recommends that the
recoverability of success fees should be capped to 10%.
6. The Government is actively assessing the implications
of Sir Rupert's proposals and will also consider the Committee's
report and recommendations including those on costs. However, in the
meantime we are minded to implement the proposal to reduce the
maximum success fee in defamation cases to 10% immediately as an
interim measure.
7. We have therefore today laid the Conditional Fee
Agreements (Amendment) Order before Parliament with a view to having
the maximum success fee of Controlling Costs in Defamation
Proceedings Summary of responses 10% in defamation cases in force as
soon as possible subject to Parliamentary approval.
8. In light of the comments received, the Order has been
amended to make clear that the new requirements will only apply to
CFAs entered into after the date on which the Order comes into force.
Defamation proceedings for the purpose of the Order means publication
proceedings (within the meaning of rule 44.12B of the [CPR]) which
includes defamation, malicious falsehood or breach of confidence
involving publication to the public at large.”
The Conditional Fee Agreements (Amendment) Order was
therefore laid before Parliament. However, that proposal was not
maintained during the run-up to the general election in May 2010.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 10 OF THE CONVENTION
CONCERNING BREACH OF CONFIDENCE
The applicant complained under Article 10 of the
Convention about the finding of breach of confidence against it as
regards its publication of the relevant articles. Article 10
reads, insofar as relevant, as follows:
“1. Everyone has the right to freedom of
expression. This right shall include freedom to hold opinions and to
receive and impart information and ideas without interference by
public authority and regardless of frontiers...
2. The exercise of these freedoms, since it
carries with it duties and responsibilities, may be subject to such
formalities, conditions, restrictions or penalties as are prescribed
by law and are necessary in a democratic society, ... for the
protection of the reputation or rights of others, for preventing the
disclosure of information received in confidence,...”
A. Admissibility of the complaint
The Court finds that the present complaint is not
manifestly ill-founded within the meaning of Article 35 § 3 of
the Convention and is not inadmissible on any other ground. It must
therefore be declared admissible.
B. The applicant's observations on the merits
The applicant noted that Ms Campbell accepted that
she could not complain about the publication of the facts of her drug
addiction and treatment because she had chosen to put into the public
domain an assertion that she did not take drugs. Every domestic judge
therefore considered that it was therefore in the public interest to
publish those matters.
The core question in the domestic courts was whether
the publication of three items of additional information (“the
additional material”) was justified or not. The addition
material impugned by the majority of the House of Lords comprised the
fact that Ms Campbell was attending NA meetings, information about
those NA meetings and two photographs of her outside her NA meetings.
The applicant preferred and relied extensively upon
the dissenting judgments of Lord Nicholls and Lord Hoffman.
It mainly argued that the majority of the House of
Lords failed to accord sufficient weight to the editor's
assessment made in good faith as to how much detail to publish in
order to ensure the credibility of the story, particularly in light
of Ms Campbell's previous false denials of addiction and treatment,
even if those details related to a medical condition. The difference
between the majority and minority in the House of Lords was not a
narrow point, as the Government suggested, but rather a fundamental
dispute as to the circumstances warranting an interference with
editorial judgment.
If there was no objection to publishing the fact of
her addiction and treatment, there could be no objection to the
publication of the details of that treatment since treatment by
attendance at NA meetings was well known treatment, widely used and
much respected. The treatment details and photographs were anodyne
once it was accepted that it was permissible to publish the fact of
her addiction and the fact that she was receiving treatment for it.
These details therefore constituted a limited intrusion into her
private life which could not take priority over the newspapers
entitlement to assess in good faith which details to publish to
support the credibility of the matters it was reporting in the public
interest. Equally, the photographs were taken to illustrate articles
on a matter of agreed legitimate public interest and, in any event,
contained no private information beyond that already legitimately
contained in the article. Moreover, given that Ms Campbell lived by
publicity, she could not insist upon too great a nicety of judgment
as to the circumstantial detail with which the story was presented.
Finally, it was impossible to see that Ms Campbell
suffered any significant additional distress because of the
publication of the additional material concerning her treatment. As
Lord Hoffman pointed out, the impact of the publication on her
continuing therapy was not pleaded domestically.
It was for the Court to decide if the domestic courts
made errors of principle and the applicant considered that they made
the above-described errors. The applicant was not suggesting that a
public figure who put aspects of her private life into the public
domain forfeited the protection of Article 8: rather it maintained
that its publication rights and rights of editorial discretion
derived from Article 10 were weightier than the private life rights
of the applicant on the facts of the present case.
C. Observations of the Government
The Government submitted that the law of England and
Wales was Convention compliant as was the application of that law to
the present facts.
A claim for breach of confidence would only succeed
if the court concluded that the publication of the private
information was wrongful. The notion of wrongful publication was
interpreted as importing the values contained in Articles 8 and 10 of
the Convention. In practice, a court was required to weigh the public
interest in maintaining the confidentiality of the information in
question against the countervailing public interest in publication.
The context for this exercise was provided by Articles 8 and 10 of
the Convention, as explained by Lord Hope (paragraph 27 above).
On matters of fine assessment of conflicting
Convention rights and the application of settled principles to the
facts of a particular case, Contracting States were entitled to a
certain margin of appreciation.
The domestic assessments demonstrated that the
balance of the Articles 8 and 10 rights in the present case was
correct and indeed a narrow point. The House of Lords relied on the
correct Convention principles as to how to balance Articles 8 and 10
rights: indeed, there was no difference of principle between the
majority and minority of the House of Lords. The narrow point at
issue between them and, consequently, in the present case was the
application of those principles to the facts of the case. The
majority considered, for relevant and sufficient reasons given, that
details of Ms Campbell's treatment went beyond justified publication.
The Government underlined that there was a clear qualitative
distinction to be made between the facts that Ms Campbell was a drug
addict and in treatment and the publication of details of the
treatment she was receiving. The non-medical therapy clearly
constituted treatment close to the core of Article 8 of the
Convention: the treatment was continuing, publication of those
details risked affecting her willingness or ability to continue and
the publication of these additional details had no public interest.
Moreover, the same reasoning applied as regards the decision by the
majority of the House of Lords as regards the photographs: the
decision on photographs flowed from their decision that information
about the treatment details of Ms Campbell was private and that there
was no public interest in its publication.
Accordingly, since the correct principles were
identified and relevant and sufficient reasons given for their
application, the House of Lords' conclusion fell within its permitted
margin. The applicant simply requested this Court to ignore this
margin of appreciation and to exercise a further appeal jurisdiction
and to prefer the minority factual analysis over that of the
majority.
As to the applicant's suggestion that the House of
Lords accorded insufficient respect to a journalist's right to decide
how much to publish to ensure credibility, the majority of the House
of Lords clearly recognised the need to afford the applicant a proper
margin in that respect. Having regard also to the “duties and
responsibilities” of journalists, the margin to be accorded was
not an unlimited one, was not out-with the supervision of the
national court and was appropriate on the facts.
D. The Court's assessment
The Court must determine whether the finding by the
majority of the House of Lords of breach of confidence against the
applicant constituted an interference with its right to freedom of
expression. Any such interference will breach the Convention if it
fails to satisfy the criteria set out in the second paragraph of
Article 10 and, in that respect, the Court must determine whether an
interference was “prescribed by law”, pursued one or more
of the legitimate aims listed in that paragraph and was “necessary
in a democratic society” in order to achieve that aim or aims.
1. Was there an interference prescribed by law for a legitimate
aim?
137. The Court considers, and it was not disputed
by the Government, that the finding of a breach of confidence against
the applicant amounted to an interference with its right to freedom
of expression.
In addition, the applicant did not contest the
lawfulness of the interference, which derived from the common law
tort of breach of confidentiality, nor that its aim, protecting the
rights of others, was legitimate. The Court accepts that the
interference was prescribed by law (paragraphs 83-88 above) and
pursued the legitimate aim of protecting “the ... rights of
others” namely, Ms Campbell's right to respect for her private
life.
2. Was the interference “necessary in a democratic society”?
The fundamental principles relating to this question
are well established in the case-law and have been summarised by the
Grand Chamber as follows (see, for example, Lindon,
Otchakovsky-Laurens and July v. France [GC], nos. 21279/02 and
36448/02, § 45, ECHR 2007 XI):
“45. Freedom of expression constitutes one of the
essential foundations of a democratic society and one of the basic
conditions for its progress and for each individual's
self-fulfilment. Subject to paragraph 2 of Article 10, it is
applicable not only to “information” or “ideas”
that are favourably received or regarded as inoffensive or as a
matter of indifference, but also to those that offend, shock or
disturb. Such are the demands of pluralism, tolerance and
broadmindedness without which there is no “democratic society”.
As set forth in Article 10, this freedom is subject to exceptions,
which must, however, be construed strictly, and the need for any
restrictions must be established convincingly.
The adjective “necessary”, within the
meaning of Article 10 § 2, implies the existence of a “pressing
social need”. The Contracting States have a certain margin of
appreciation in assessing whether such a need exists, but it goes
hand in hand with European supervision, embracing both the
legislation and the decisions applying it, even those given by an
independent court. The Court is therefore empowered to give the final
ruling on whether a “restriction” is reconcilable with
freedom of expression as protected by Article 10.
The Court's task, in exercising its supervisory
jurisdiction, is not to take the place of the competent national
authorities but rather to review under Article 10 the decisions they
delivered pursuant to their power of appreciation. This does not mean
that the supervision is limited to ascertaining whether the
respondent State exercised its discretion reasonably, carefully and
in good faith; what the Court has to do is to look at the
interference complained of in the light of the case as a whole and
determine whether the reasons adduced by the national authorities to
justify it are “relevant and sufficient” and whether it
was “proportionate to the legitimate aim pursued”. In
doing so, the Court has to satisfy itself that the national
authorities applied standards which were in conformity with the
principles embodied in Article 10 and, moreover, that they relied on
an acceptable assessment of the relevant facts ... .”
A number of additional factors are particularly
relevant to the Court's supervisory role in the present case.
In the first place, regard must be had to the
pre-eminent role of the press in a State governed by the rule of law
(for example, Goodwin v. the United Kingdom, 27 March 1996, §
39, Reports 1996 II). Whilst it is true that the methods
of objective and balanced reporting may vary considerably and that it
is therefore not for this Court, nor for the national courts, to
substitute its own views for those of the press as to what technique
of reporting should be adopted (Jersild v. Denmark, 23
September 1994, § 31, Series A no. 298), editorial discretion is
not unbounded. The press must not overstep the bounds set for, among
other things, “the protection of the reputation of ... others”,
including the requirements of acting in good faith and on an accurate
factual basis and of providing “reliable and precise”
information in accordance with the ethics of journalism (Pedersen
and Baadsgaard v. Denmark [GC], no. 49017/99, § 78, ECHR
2004 XI with further references contained therein). Nevertheless
it is incumbent on it to impart information and ideas on matters of
public interest (De Haes and Gijsels v. Belgium, 24 February
1997, § 37, Reports 1997 I). Not only does it have
the task of imparting such information and ideas: the public also has
a right to receive them. Were it otherwise, the press would be unable
to play its vital role of “public watchdog” (Observer and
Guardian v. the United Kingdom, 26 November 1991, § 59,
Series A no. 216; Thorgeir Thorgeirson v. Iceland, 25 June
1992, § 63, Series A no. 239 Bladet Tromsø and
Stensaas v. Norway [GC], no. 21980/93, § 62, ECHR 1999 III;
and, more recently, Gutiérrez Suárez
v. Spain, no. 16023/07, § 25, 1
June 2010).
In addition, when verifying whether the authorities struck a fair
balance between two protected values guaranteed by the Convention
which may come into conflict with each other in this type of case,
freedom of expression protected by Article 10 and the right to
respect for private life enshrined in Article 8, the Court must
balance the public interest in the publication of a photograph and
the need to protect private life (Hachette Filipacchi Associés
v. France, no. 71111/01, § 43, ECHR 2007 VII. The
balancing of individual interests, which may well be contradictory,
is a difficult matter and Contracting States must have a broad margin
of appreciation in this respect since the national authorities are in
principle better placed than this Court to assess whether or not
there is a “pressing social need” capable of justifying
an interference with one of the rights guaranteed by the Convention
(Chassagnou and Others v. France [GC], nos. 25088/94, 28331/95
and 28443/95, § 113, ECHR 1999 III).
Finally,
the Court considers that the publication of the photographs and
articles, the sole purpose of which is to satisfy the curiosity of a
particular readership regarding the details of a public figure's
private life, cannot be deemed to contribute to any debate of general
interest to society despite the person being known to the public. In
such conditions freedom of expression calls for a narrower
interpretation (see, mutatis mutandis, Campmany y Diez de
Revenga and Lopez Galiacho Perona v.
Spain (dec.), no. 54224/00, ECHR
2000-XII; Julio Bou Gibert and El
Hogar Y La Moda J.A. v. Spain (dec.),
no. 14929/02, 13 May 2003; and Prisma Presse v. France
(dec.), nos. 66910/01 and 71612/01, 1 July 2003; as cited in Von
Hannover v. Germany, no. 59320/00, § 65-66, ECHR
2004 VI). Moreover,
although freedom of expression also extends to the publication of
photographs, this is an area in which the protection of the rights
and reputation of others takes on particular importance. Photographs
appearing in the tabloid press are often taken in a climate of
continual harassment which induces in the person concerned a very
strong sense of intrusion into their private life or even of
persecution (Von Hannover v. Germany, cited above, at §
59. See also Hachette Filipacchi Associés v. France,
cited above, § 42).
The Court has therefore examined whether the finding
of a breach of confidence by the majority of the House of Lords
disclosed relevant and sufficient reasons through an examination of
whether the standards applied to the assessed facts were in
conformity with the principles embodied in Article 10 of the
Convention (Lindon, Otchakovsky-Laurens and July v. France, cited
above).
The Court has set out the domestic judgments in some
detail and, notably, those of the majority of the House of Lords
impugned by the applicant (paragraphs 25-54 above). It observes that
the majority members of the House of Lords recorded the core
Convention principles and case-law relevant to the case. In
particular, they underlined in some detail the particular role of the
press in a democratic society and, more especially, the importance of
publishing matters of public interest. In addition, and contrary to
the applicant's submission, each member of the majority specifically
underlined the protection to be accorded to journalists as regards
the techniques of reporting they adopt and as regards decisions taken
about the content of published material to ensure credibility, as
well as journalists' duties and responsibilities to act in good faith
and on an accurate factual basis to provide “reliable and
precise” information in accordance with the ethics of
journalism (citing, in particular, Jersild v. Denmark, cited
above, § 31 and Fressoz and Roire v. France [GC], no.
29183/95, § 54, ECHR 1999 I, see paragraphs 28-29, 35, 40
and 47 above). Moreover, the majority recorded the need to balance
the protection accorded under Articles 8 and 10 so that any
infringement of the applicant's Article 10 rights with the aim of
protecting Ms Campbell's privacy rights had to be no more than was
necessary, neither Article having a pre-eminence over the other
(citing, inter alia, Resolution 1165/98 entitled “Right
to Privacy” of the Parliamentary Assembly of the Council of
Europe and A v B plc [2003] QB 195). Finally, the majority
explained the particularly private nature of information concerning a
person's treatment for drug addiction and the potential detriment
resulting from its disclosure.
The Court further observes that all members of the
House of Lords, both minority and majority, were in agreement as to
these relevant principles. Lord Hope noted that the case did not
raise any new issues of principle but was rather concerned with
questions of “fact and degree” and Lord Hoffman
emphasised that all members of the House of Lords were unanimous as
to the applicable principles but were divided in their application to
the narrow point related to the facts of the case (paragraphs 26 and
50 above).
Indeed,
there was agreement at all three instances (and among all members of
the House of Lords) as to the application of those principles to the
main part of the published articles. They considered Ms Campbell to
be an internationally known model and celebrity. Given her prior
public denials of drug use, the core facts of her drug addiction and
the fact that she was in treatment were legitimately a matter of
public interest and capable of being published. Ms Campbell accepted
this before the domestic courts, as did the parties before this
Court. In making this undisputed qualitative distinction between, on
the one hand, private information which Ms Campbell had already made
public and which was therefore legitimately the subject of a public
debate and, on the other, the additional information which she had
not made public, the Court considers that all three domestic courts
which examined the case reflected the same distinction underlined by
this Court in the above-cited Von Hannover case decided some
days after the present judgment of the House of Lords.
Accordingly, the difference of opinion between the
judges in the national courts on which the present complaint turns,
concerned only the application of relevant Convention principles to
the question whether an interference with the editorial decision to
publish the additional material (the fact that she was attending NA,
details about the nature of her NA treatment and covertly taken
photographs outside her NA meetings) was justified under Article 10.
The High Court examined this issue over 5 days and,
in a detailed and lengthy judgment, found the publication of the
additional material unjustified. The Court of Appeal, following a
hearing of 2 days and by another detailed judgment, allowed the
applicant's appeal finding the publication of the additional material
to be justified. Having heard the appeal over 2 days and, each of the
five members giving detailed judgments, the House of Lords found by a
majority (3 to 2) that the publication of the additional material
exceeded the latitude accorded to editorial assessment and was not
justified.
Against this background, the Court considers that,
having regard to the margin of appreciation accorded to decisions of
national courts in this context, the Court would require strong
reasons to substitute its view for that of the final decision of the
House of Lords or, indeed, to prefer the decision of the minority to
that of the majority of that court, as the applicant urged the Court
to do.
Indeed, the Court considers convincing the reasons
for the decision of the majority of the House of Lords. The majority
underlined, inter alia, the intimate and private nature of the
additional information about Ms Campbell's physical and mental health
and treatment and concluded that the publication of the additional
material about that treatment had been harmful to Ms Campbell's
continued treatment with NA in the United Kingdom and risked causing
a significant setback to her recovery as well as being considerably
distressing for her. The photographs had been taken covertly with a
long range lens outside her place of treatment for drug addiction and
would have been clearly distressing for a person of ordinary
sensitivity in her position and faced with the same publicity; the
photographs had been taken deliberately with a view to inclusion in
the article and were accompanied with captions which made it clear
she was coming from her NA meeting thereby connecting those
photographs to the private information in the articles; and those
photographs allowed the location of her NA meetings to be identified.
On the other hand, the publication of the additional material was
found not necessary to ensure the credibility of the story, the
applicant itself accepting that it had sufficient information without
the additional material to publish the articles on the front page of
its newspaper. Nor was it considered that there was any compelling
need for the public to have this additional material, the public
interest being already satisfied by the publication of the core facts
of her addiction and treatment.
The applicant maintained that it was impossible to
find that Ms Campbell suffered significant additional distress
because of the publication of the additional material. However, that
was precisely what the majority of the House of Lords considered to
be established: whether or not the publication of that additional
material prejudiced her continued treatment with NA (and see Lord
Hoffman at paragraph 54 above), the majority of the House of Lords
found that it had caused her some distress, Baroness Hale
specifically relying on the evidence taken and findings of fact in
this respect of the first instance court (paragraph 41 above). The
relatively low award of damages of the first instance court (restored
by the majority of the House of Lords) reflected the former court's
assessment of the level of prejudice suffered.
Finally, it was pointed out by the applicant that the
Court of Appeal found that the photographs had not been, of
themselves, relied upon by Ms Campbell as a ground of complaint.
However, Lord Nicholls (paragraph 49 above) clarified that the
applicant complained that the information conveyed in the photographs
was private and, further, the majority members of the House of Lords
(paragraphs 32, 39 and 43 above) found that the captions and context
in which the photographs were presented, which made it clear that Ms
Campbell was coming from her NA meeting at an identifiable place,
inextricably linked the photographs to the impugned private
additional material. Accordingly, as the Government expressed it, the
decision of the House of Lords on the photographs flowed from their
decision that the additional material about Ms Campbell's treatment
details was private and without public interest.
It is indeed true that the minority of the House of
Lords found that the additional material was anodyne and
inconsequential, noting that it was unremarkable to add the details
of Ms Campbell's treatment with NA and, further, that the
photographs, of themselves, added little and were not demeaning or
embarrassing, so that the publication of all of this additional
material fell within the latitude to be accorded to journalists. The
applicant urged the Court to prefer the opinion of the minority.
However, the relevancy and sufficiency of the reasons
of the majority as regards the limits on the latitude given to the
editor's decision to publish the additional material is such that the
Court does not find any reason, let alone a strong reason, to
substitute its view for that of the final decision of the House of
Lords or to prefer the decision of the minority over that of the
majority of the House of Lords, as the applicant urged the Court to
do.
In such circumstances, the Court considers that the
finding by the House of Lords that the applicant had acted in breach
of confidence did not violate Article 10 of the Convention.
II. ALLEGED VIOLATION OF ARTICLE 10 OF THE CONVENTION
CONCERNING RECOVERABLE SUCCESS FEES
The parties devoted extensive submissions to the
precise nature of this complaint. The Court considers that the
applicant's core complaint concerned the recoverability against it,
over and above the base costs, of success fees which had been agreed
between Ms Campbell and her legal representatives as part of a CFA.
A. Admissibility of the complaint
The Government relied on the fact that the
applicant did not challenge the level of the base costs of the first
appeal to the House of Lords and that it had, in the end, settled all
of Ms Campbell's costs' claims against it. The only ground of
inadmissibility invoked by the Government in these respects was that
the case was manifestly ill-founded. The Court considers it
appropriate to examine these submissions on the merits of the
complaint.
The Court therefore finds that the present complaint
is not manifestly ill-founded within the meaning of Article 35 §
3 of the Convention and is not inadmissible on any other ground. It
must therefore be declared admissible.
B. The applicant's observations
The applicant did not contest the base costs before
the first instance court, the Court of Appeal or the House of Lords.
It did not contest the use of CFAs in publication cases or in the
present case.
The applicant's core complaint concerned, rather, the
recoverability of success fees included in CFAs. In particular,
it complained that the total costs order against it was excessive
because it included success fees in both appeals to the House of
Lords which amounted to double the amount of the base costs of those
appeals in a situation where domestic courts were expressly precluded
by the Costs Practice Directions (paragraph 11.9) from controlling
and reducing the total costs payable.
The requirement to pay the success fees of Ms
Campbell's lawyers was an interference with the applicant's freedom
of expression. While it was prescribed by law, it did not pursue a
legitimate aim and was not necessary in a democratic society.
In the first place, the costs were excessive,
amounting to disproportionate and punitive awards against
media organisations.
They were excessive by definition, being a multiple of already high
base costs. Base costs in defamation and privacy cases were
noticeably higher (GBP 400-500 per hour) when compared to other
equally complex civil and criminal cases before the House of Lords
(GBP 140 per hour in a serious rape case). In addition, a success fee
was applied which could double those already high base costs. In the
present case, uplifts of 95% and 100% were accepted as appropriate
and a 100% success fee in a CFA was regularly charged. Moreover, a
second success fee of 95% was charged as regards the second appeal to
the House of Lords challenging the first success fee, which left the
applicant in an impossible position. It was, moreover, perverse that
the greater the prospects of success of a defence (for example, if it
was assessed at 50/50), the higher the success fee.
In addition, the total costs, including success fees, were also
excessive in that they bore no relationship of proportionality to the
damages recovered by Ms Campbell (GBP 3,500), it being inconceivable
that even wealthy claimants would pay that sum in costs for the small
damages obtained.
Moreover, they were excessive because the CFAs and success fee system
meant that there was no incentive for a claimant's legal
representatives to keep costs low.
Secondly, the principle was no different from the
requirement of proportionality between damages for defamation and the
injury suffered which was set out in Tolstoy Miloslavsky v. the
United Kingdom (13 July 1995, Series A no. 316 B, §
49). The costs award to which it was subjected was excessive and,
even though domestic law required base costs and the percentage
success fee rate to be reasonable, the control of the level of costs
awards was deficient, a matter recognised by the domestic
consultation process.
Thirdly, this excessive burden constituted a chilling
effect on the applicant as a media organisation. The financial impact
of CFAs inevitably inhibited media organisations from defending
claims that should be fought and put pressure on them to settle early
valid claims and, further, deterred such organisations from
publishing material, including material which it would be proper to
publish. The applicant relied on, inter alia, statements made
to the House of Commons Constitutional Affairs Select Committee
(paragraph 104 above) by numerous well-known press and media
organisations, which statements set out those organisations'
experience of, and concerns about, success fees in publications
cases.
Fourthly, success fees did not achieve the aim of
giving impecunious but deserving claimants access to justice because
there were no obligations concerning, or mechanism controlling, a
lawyer's use of success fees earned in one case to take on other poor
claimants with deserving cases. The domestic consultation process
confirmed that access to justice for impecunious clients had not
increased. The impression of many media groups was that certain
solicitors conducted weak cases on an ordinary retainer and strong
cases on CFAs. Since, in addition, the media rarely win publication
cases, a success fee was therefore a windfall profit for lawyers and
a punitive award against the media. Indeed, since there was no means
of ensuring that impecunious litigants benefited, the only result of
the scheme was to shift the burden of funding civil litigation from
the public purse to the private sector.
Fifthly, allowing success fees to claimants such as
Ms Campbell who could afford legal fees and were at no risk
whatsoever of being denied access to justice was entirely unnecessary
for the above-noted legitimate aim. Indeed, the House of Lords simply
deferred to what it assumed was parliament's intention. The House of
Lords failed to determine whether success fees (including for wealthy
claimants) were necessary to contribute to access to litigation by
impecunious litigants and, indeed, these were not factors which a
judge assessing costs could take into account. The CFA system should
therefore be amended to exclude wealthy claimants and means testing
was possible to achieve this since the same financial eligibility for
legal representation in criminal cases had been usefully employed in
Magistrates Courts, which courts tried approximately 95% of criminal
cases.
Sixthly, publication cases were sufficiently
distinguishable from other civil litigation, for the CFA scheme to
exclude such cases. The applicant reiterated the reasons, also
outlined by Lord Hoffman at paragraph 67 above, as to why the
CFA/success fee system had a heavier impact in publication cases
compared to other cases, such as traffic cases.
C. The Government's observations
The Government noted that the applicant did not
contest the costs in the High Court and the Court of Appeal or the
base costs in the House of Lords. Moreover, it did not object in the
domestic courts to the use of CFAs, to costs following the event or
to a costs order including a lower level success fee. The
applicant's core case before this Court had become a complaint that
the domestic courts were precluded from reducing the total costs
payable by an unsuccessful defendant, even when they were
disproportionate and excessive as a result of the success fees, given
paragraph 11.9 of the Costs Practice Directions.
The Government considered that the Court should
examine only the underlying legislative provisions (sections 58 and
58A of the 1990 Act) namely, the overall scheme which permitted a
person to enter into a CFA in practically all types of litigation
with a success fee which could be recovered against an unsuccessful
defendant in order to fund litigation by other persons.
As to whether those legislative provisions
constituted an interference with the applicant's freedom of
expression, the Government pointed out that the relevant provisions
were permissive as to whether a CFA with success fee was concluded;
as to the amount of that fee (subject to a statutory maximum of
100%); and, indeed, as to the making by a court of any specific form
of costs order against an unsuccessful party. In any event, even if
the interference of which the applicant appeared to complain may have
been capable of amounting to an interference with its right to
freedom of expression, it was one of a low order and was minimal.
The applicant had not disputed that the interference
was prescribed by law and the Government clarified that the impugned
costs order with success fees was based on sections 58 and 58A of the
1990 Act (inserted by the 1999 Act) and on Rule 44 of the CPR and the
Costs Practice Directions.
The Government recalled that the purpose of allowing
CFAs to be concluded was to achieve the widest public access to legal
services funded by the private sector. In particular, CFAs provided a
greater range of funding options to allow the widest possible range
of people, including but not limited to claimants and defendants just
above the means test for legal aid but not sufficiently wealthy to
incur litigation costs, to have a real opportunity to have effective
access to legal services and to the courts in relation to as many
forms of litigation as possible. This was achieved through a
fundamental re-balancing of the means of access to justice by resort
to private sector funding (and hence funded indirectly by the public
as a whole) rather than by the use of public (legal-aid) funds. It
was intended to balance the rights of all litigants (claimants,
defendants and successful or not), as well as the interests of
lawyers who were expected to provide their services to the widest
range of persons possible on a CFA. This allowed the State to
re-allocate legal-aid resources by removing, for example, through
the 1999 Act personal injuries claims from the legal-aid system,
given the effectiveness of CFAs.
Success fees enhanced the effectiveness of the CFA
and were thus an integral part of the CFA scheme. It would ensure
that lawyers would provide legal services on a CFA to the widest
range of persons and not just to those whose claims were the
strongest. Success fees were designed to broadly reflect the overall
risk undertaken by a legal representative across his range of work
and thus serve a purpose beyond a single piece of litigation.
“Excessive” costs in a single case were justified by the
general objective. In addition, the level of the success fee had to
be high enough to provide a clear incentive to legal representatives
to provide services under a CFA to those whose cases were less
meritorious. The level also had to be sufficiently limited so as “to
afford the client with the practical opportunity to pursue or defend
legal proceedings”. The maximum uplift was therefore 100%.
Moreover, it was also necessary for success fees to be recoverable
from the unsuccessful party. Without this possibility, the CFA would
not have been useful for claimants, unless the potential value of
their cases would cover the success fee and other costs leaving
sufficient damages to make the claim worthwhile, or for those seeking
non-monetary remedies or for defendants.
Promoting thereby access to justice, guaranteed by
Article 6 of the Convention, was plainly a legitimate aim for the
purposes of Article 10 § 2 of the Convention.
The Government went on to argue in some detail that
recoverable success fees did not amount to a disproportionate
interference with the applicant's right to freedom of expression.
Contracting States were entitled to adopt rules and schemes of
general application in support of social policy objectives and, in
conceiving of such schemes, were required to carry out a delicate
balance of a range of relevant and competing social and public
interests including, as in the present case, issues under Articles 6
and 10 of the Convention. Indeed, “excessive” costs in a
single case would be justified by the general objective. In these
respects, they were to be afforded a significant margin of
appreciation for this exercise (Blečić v. Croatia,
no. 59532/00, § 64, 29 July 2004; and Evans v. the United
Kingdom [GC], no. 6339/05, § 68, ECHR 2007 IV).
The Government made lengthy submissions to the effect
that the recovery of success fees was subject to a number of
safeguards, the argument being that those safeguards struck a proper
balance between the interests of unsuccessful litigants and the
objective of expanding access to justice consonant with Article 6 of
the Convention.
The first safeguard was the fixing of the maximum
uplift at 100%.
The second safeguard was the requirement that the
base costs and the success fees contained in a CFA were to be
regulated by a court separately and on a case by case basis against
the criterion that such amount should be no more than was reasonable
and proportionate, any doubt to be resolved in favour of the paying
party (Rule 44.4 of the CPR and paragraph 11 of the Costs Practice
Directions). In particular, the base costs had to be reasonable and
proportionate (paragraph 11.6 of the Costs Practice Directions) and
thus were subject to assessment under Rule 44 of the CPR. A court was
also required to consider whether there should be a success fee and,
if so, whether the percentage uplift was reasonable (paragraph 11.7
of the Costs Practice Directions) and paragraph 11.8 contained a
non-exhaustive list of factors to which a court could have regard in
so deciding. All the impugned paragraph 11.9 of the Costs
Practice Directions did therefore was to acknowledge the
above-described control which had already been applied to the base
and success fee elements of the costs order so that a further
reduction of the total costs was unnecessary. Indeed, it would be
illogical to allow a double reduction of the total costs as it would
imply that a court would, in the end, award base costs that were less
than what was initially considered reasonable.
As to the applicant's suggestion that “publication
cases” be excluded from the system, there was no reason to
suggest that those involved in publication cases should have less
access to legal services; cases against newspapers concerned
important and sensitive rights' issues for which CFAs should be
available; and since legal aid was never available for defamation
cases, those on modest incomes could not consider bringing or
defending such actions without CFAs.
The applicant's submission that persons such as Ms
Campbell should not have access to CFAs was rejected by the House of
Lords. It did not matter if her solicitors had indicated that they
did little CFA work: when pursuing broad social policy objectives, a
State was entitled to adopt provisions of general application so that
the justification of the general scheme was not undermined by one
example. As to whether entitlement to the CFA system should be means
tested, the Government relied on Lord Hoffman's judgment in the
second appeal and maintained that this was precisely the type of
social and economic decision to which the margin of appreciation
applied. There were no clear objective criteria by which one could
regulate access to the CFA/recoverable success fee scheme according
to the financial status of a claimant and, indeed, any attempt to
draw such a line would undermine the objective of promoting wide
access to legal services and would risk those falling just the wrong
side of the line being significantly disadvantaged. It would also be
unrealistic to expect the private sector to control financial
qualifications.
As to the consistency between the Government's
submissions to the Court and those during the consultation process
concerning paragraph 11.9 of the Costs Practice Directions in
particular, the Government noted that the fact that it was
considering reform of that specific provision did not mean that it
was contrary to Article 10. If the Consultation Paper suggested that
amending it might be an improvement (paragraph 108 above), that did
not amount to a statement that it was “necessary” under
Article 10, the Convention requiring minimum standards and States
being free to provide further protection (Brecknell v. the United
Kingdom, no. 32457/04, § 70, 27 November 2007). The
maintenance of the current CFA/recoverable success fee system fell
within its margin of appreciation and, indeed, the ongoing domestic
consultation process underlined why, in such a complex area of social
and economic policy, that margin should be respected.
Nor was the application of these domestic provisions
to the applicant's case a disproportionate interference. The only
complaint made by the applicant before the domestic courts and this
Court was the principle of recoverable success fees as regards both
appeals to the House of Lords. However, it did not seek a
determination by a court as to whether the level of those success
fees was reasonable and proportionate. Equally, the applicant did not
request a court to review the level of costs having regard to the low
damages award made. Indeed, when the applicant did challenge the base
costs in respect of Ms Campbell's lawyers in the second appeal, these
were found to be disproportionate and reduced.
D. The third parties' submissions and the Government's response
Joint submissions were made by Open Society Justice
Initiative, Media Legal Defence Initiative, Index on Censorship, the
English PEN, Global Witness and by Human Rights Watch.
They considered that the case raised an important
issue as to the chilling effect of high costs in defamation
proceedings on NGOs and small media organisations with small budgets,
which organisations were often involved in investigative reporting
and dissemination of information on issues of significant public
interest.
As to those high costs, they relied on a “Comparative
Study of Costs in Defamation Proceedings across Europe”, as
part of the “Programme in Comparative Media Law and Policy”
of the Centre for Socio-Legal Studies at Oxford University, which had
compared costs of defamation proceedings in 11 countries (Belgium,
Bulgaria, Cyprus, France, Germany, Ireland, Italy, Malta, Romania,
Spain and Sweden) as well as in England and Wales. Claimants with
CFAs incurred substantially higher legal costs than defendants who
had no CFA because of the lack of incentive of a client with a CFA to
control the costs of legal work done on its behalf. In addition, the
study estimated that, even in non-CFA cases, costs in the UK were 4
times higher than in the next most costly jurisdiction, Ireland.
Ireland was, in turn, almost ten times more expensive than Italy, the
third most expensive jurisdiction. If the figure for average costs
across the jurisdictions is calculated without including the figures
from England and Wales and Ireland, England and Wales is seen to be
around 140 times more costly than the average. None of the comparator
countries had CFA schemes, let alone success fees, a factor of itself
demonstrative of its disproportion.
While CFAs had an important role to play in
supporting public interest litigation, the system had to be designed
so as not to infringe those organisations' Article 10 rights. The
availability of CFAs had made it more difficult for non-governmental
organisations (“NGOs”) and small publications to publish
information on matters of public interest.
NGOs that investigated and exposed serious
wrongdoing, which included many of the interveners, were increasingly
assuming the traditional watchdog function of the media and, in
seeking to expose unpopular truths, NGOs were particularly vulnerable
to defamation actions. This was particularly so given libel tourism,
the laws of England and Wales allowing organisations to be sued in
that jurisdiction even if only a small proportion of the readership
(print or internet) was located there. This was compounded by the
difficulty in obtaining libel costs' insurance, given their risk
profile, and by the CFA scheme.
The chilling effect of the excessive costs caused by
CFA schemes in England and Wales amounted to a restriction on the
Article 10 rights of these publishers which bore no relationship of
proportionality to the injury suffered by a claimant and the
Government had fashioned no doctrine to prevent this.
In response, the Government contended that these
submissions were not directed to the costs matter at issue in the
present case namely, recoverable success fees. As to the chilling
effect of increased costs pursuant to CFAs, this was answered by the
availability of defences to defamation actions under substantive law
and by the role of the courts in controlling costs.
As to the comparative research, the Government
contended that insufficient information was known about the study so
as to ensure that like was being compared with like. It was
inaccurate, for example, in stating that domestic law in England and
Wales did not control the reasonableness and proportionality of the
costs awarded. The extent to which the differing costs were
reflective of the differing legal procedures was not known. Any lack
of incentive on the part of a client with a CFA to control costs
incurred on its behalf was again answered by the control exercised by
the courts over the reasonableness and proportionality of costs'
awards. In any event, the applicant's complaints did not concern the
general level of base costs in defamation proceedings.
E. The Court's assessment
1. Was there an interference?
The applicant's complaint, as noted at paragraph 157
above, concerns the impact on it of a costs award which, under
domestic law, included success fees calculated at almost twice most
of the base costs of two appeals to the House of Lords. The Court
considers, and it was not seriously disputed by the Government, that
the requirement to pay these success fees, as an unsuccessful
defendant in breach of confidence proceedings, constituted an
interference with the applicant's right to freedom of expression
guaranteed by Article 10 of the Convention.
The fact, as emphasised by the Government, that the
underlying legal regime was “permissive”, in that it
permitted a CFA including success fees to be concluded rather than
requiring it, does not change the fact that the applicant was
required, pursuant to a court order for costs, to pay costs including
the impugned success fees to the claimant.
2. Was the interference “prescribed by law”?
The provisions relating to CFAs, the calculation of
success fees by a percentage uplift and their recoverability from an
unsuccessful defendant are regulated by the 1990 and 1999 Acts, the
Conditional Fees Arrangement Orders 1995 and 2000 as well as the CPR
and the relevant Costs Practice Directions, as outlined at paragraphs
89-98 above. It is clear, and the parties did not dispute, that the
interference was prescribed by law within the meaning of Article 10
of the Convention.
3. Did the interference have a “legitimate aim”?
The essential objective of CFAs, of which success
fees recoverable from an unsuccessful defendant were an integral
part, were broader than the individual case and were described by the
Government at paragraphs 173-175 above. This system was designed to
provide a greater range of funding options to allow the widest
possible range of people to have a real opportunity to have effective
access to legal services and to the courts in relation to as many
forms of civil litigation as possible, and to do so via a
fundamental re-balancing of the means of access to justice by
resorting to private sector funding rather than use of public funds.
The
Court recalls that the right of effective access to a court is a
right inherent in Article 6 of the Convention (Golder v. the
United Kingdom, 21 February 1975, Series A no. 18). While it does
not require state assistance in all matters of civil litigation, it
may compel the State to provide, for example, the assistance of a
lawyer when such assistance proves indispensable for effective access
to court, depending on the particular facts and circumstances,
including the importance of what is at stake for the applicant
in the proceedings, the complexity of the relevant law and procedure
and the applicant's capacity to represent him or herself (Airey v.
Ireland, 9 October 1979, § 26, Series A no. 32; and
Steel and Morris v. the United Kingdom, no. 68416/01, § 61,
ECHR 2005 II and references contained therein).
The Court therefore accepts that the CFA with
recoverable success fees sought to achieve the legitimate aim of the
widest public access to legal services for civil litigation funded by
the private sector and thus the protection of the rights of others
within the meaning of Article 10 § 2 of the Convention.
4. Was the interference “necessary in a democratic society”?
The Court will examine whether success fees
recoverable against unsuccessful defendants are “necessary in a
democratic society” to achieve that aim. In particular, it must
consider the proportionality of requiring an unsuccessful defendant
not only to pay the reasonable and proportionate costs of the
claimant, but also to contribute to the funding of other litigation
and general access to justice, by paying up to double those costs in
the form of recoverable success fees. The applicant did not complain
about having had to pay any ATE premiums of the claimant.
199. This complaint also concerns the question of whether the
authorities struck a fair balance between two values guaranteed by
the Convention which may come into conflict with each other, namely,
on the one hand, freedom of expression protected by Article 10 and,
on the other, an individual's right of access to court protected by
Article 6 of the Convention. As noted at paragraph 142 above, this
balancing of individual Convention interests attracts a broad margin
of appreciation.
Moreover,
a wide margin of appreciation is available to a legislature in
implementing social and economic policies and the Court will respect
the legislature's judgment as to what is “in the public
interest” unless that judgment is manifestly without reasonable
foundation (James and Others v. the United Kingdom, 21
February 1986, § 46, Series A no. 98). The Court later described
this margin of appreciation as the “special weight” to be
accorded to the role of the domestic policy-maker in matters of
general policy on which opinions within a democratic society may
reasonably differ widely (Hatton and Others v. the United Kingdom
[GC], no. 36022/97, § 97, ECHR 2003 VIII).
However, if such general measures produce an individual and excessive
burden, the requisite balance will not be found (James and Others
v. the United Kingdom, at § 50): put otherwise, the Court
may not regard as disproportionate every imbalance between the public
interest and its effects on a particular individual but will do so in
exceptional circumstances, when a certain “threshold of
hardship” on the individual has been crossed (Velikovi and
Others v. Bulgaria, nos. 43278/98, 45437/99, 48014/99, 48380/99,
51362/99, 53367/99, 60036/00, 73465/01 and 194/02, § 192, 15
March 2007).
However,
the Court has found the most careful scrutiny on the part of the
Court is called for when measures taken by a national authority are
capable of discouraging the participation of the press in debates
over matters of legitimate public concern (Jersild v. Denmark,
cited above, § 35; and Bladet Tromsø and Stensaas v.
Norway [GC], cited above, § 64. It is, moreover, not
necessary to consider, in any particular case, whether a damages
award has a chilling effect on the press as a matter of fact so that,
for example, unpredictably large damages awards in defamation cases
are considered capable of having such an effect (Independent News
and Media and Independent Newspapers Ireland Limited v. Ireland,
no. 55120/00, § 114, ECHR 2005 V (extracts)).
The Court notes at the outset that the essential
position of the Government was that any disproportionality visited on
an individual case by the CFA/recoverable success fee regime was
justified by the need to adopt provisions of general application when
pursuing broad social and economic policy objectives. They referred
to the reasoning of Lord Hoffman who had similarly responded to the
applicant's argument based on the facts of its case namely, that Ms
Campbell was wealthy so that a CFA/recoverable success fee was not
necessary to ensure her access to court. Lord Hoffman found that the
general policy objectives underlying the CFA/recoverable success fees
scheme meant that the scheme could not be disallowed solely on the
ground that liability of an individual applicant would be
inconsistent with its rights under Article 10 of the Convention
(relying on the above-cited James v. the United Kingdom case).
He considered the scheme to be a rational legislative policy which
the Government could adopt as a general scheme compatibly with
Article 10 and which the courts had to accept (Lord Hoffman at
paragraph 63 above. See also Lord Carswell, paragraphs 72-73 above).
203. However, one of the particularities of the present case is
that this general scheme and its objectives have themselves been the
subject of detailed and lengthy public consultation notably by the
Ministry of Justice since 2003. While most of this process transpired
after the House of Lords judgment in the second appeal in the present
case (2005), it highlighted fundamental flaws underlying the
recoverable success fee scheme, particularly in cases such as the
present. The Court has therefore set out this public consultation
process in some detail above (paragraphs 100-120 above) and has
highlighted key elements below.
By March 2006 the House of Commons Constitutional
Affairs Select Committee considered that the courts should address
the question of disproportionate costs in defamation and privacy
proceedings and it made certain proposals including cost-capping. No
legislative action was taken. The proposal of staged success fees
(re-assessing the risk and the percentage of the success fee as the
action progressed) was then included in the “Theobalds Park
Plus Agreement” drafted by the CJC following mediation between
media organisations and claimants' representatives. The Ministry of
Justice agreed with the CJC's recommendations that the Theobalds Park
Plus Agreement could help ensure that costs of litigation were
proportionate and reasonable. As a result, in 2007 it sought views on
the implementation of the CJC's recommendations including on a range
of fixed staged recoverable success fees. A slightly revised scheme
was published with responses to the consultation in July 2008. The
media, in particular, did not support the proposals and the scheme
was not implemented.
The Ministry of Justice then published a further
Consultation Paper in February 2009. It noted that the high levels of
legal costs incurred in publication proceedings had been the subject
of criticism and debate in the courts and in Parliament; that
excessive costs might force defendants to settle unmeritorious claims
which in turn threatened a risk to reporting; and that some had
argued that it was a risk to freedom of expression. It sought views
on measures to better control costs. While certain minor proposals
concerning, inter alia, additional information and control of
ATE insurance were proposed and introduced (The Civil Procedure
(Amendment) Rules 2009), other matters were left open pending the
Jackson Review. Amending the prohibition on reviewing the
proportionality of the total costs (paragraph 11.9 of the Costs
Practice Directions) was principally considered with respect to
defamation disputes because it was mainly in those cases that the key
problems addressed in the Paper were seen to arise.
The Jackson Review, commissioned by the Ministry of
Justice and published January 2010, was an extensive review of costs
in civil litigation and it highlighted four flaws inherent in the
recoverability of success fees in civil litigation.
The first flaw of the recoverable success fee regime
was the lack of focus of the regime and the lack of any qualifying
requirements for claimants who would be allowed to enter into a CFA.
He highlighted certain anomalies flowing from this.
Secondly, Jackson LJ considered flawed the fact that
there was no incentive on the part of a claimant to control the
incurring of legal costs on his or her behalf and that judges
assessed those costs only at the end of the case, when it was
considered too late to control what had been spent.
This concern was highlighted by the third party submissions to this
Court by media organisations (paragraph 186 above). The consequent
“costs race” and resulting rise in costs were
particularly underlined by the judiciary (the King case at
paragraph 99 above and by Lord Hoffman in the costs' appeal in the
present case at paragraph 65 above).
The third flaw was the “blackmail” or
“chilling” effect of the system of recoverable success
fees. The costs burden on the opposing parties was so excessive that
often a party was driven to settle early despite good prospects of a
successful defence.
This “ransom” effect of the scheme was highlighted during
the earlier public consultation processes (see paragraphs 101 and
107 above), by the judiciary in other cases (the Turcu
and King cases, at paragraphs 98 and 99 above), in the
judgments of the House of Lords in the second appeal in the present
case (Lords Hoffman and Carswell, paragraphs 64 and 72 above) and by
the third parties (paragraphs 185 and 189 above).
The fourth flaw was the fact that the regime
provided, at the very least, the opportunity, it not being possible
to verify the confidential financial records of solicitors and
barristers, to “cherry pick” winning cases to conduct on
CFAs with success fees. The Court considers it significant that this
criticism by Jackson LJ would imply that recoverable success fees did
not achieve the intended objective of extending access to justice to
the broadest range of persons: instead of lawyers relying on success
fees gained in successful cases to fund their representation of
clients with arguably less clearly meritorious cases, lawyers had the
opportunity to pursue meritorious cases only with CFAs/success fees
and to avoid claimants whose claims were less meritorious but which
were still deserving of being heard.
Jackson LJ went on to point out that these flaws
produced in defamation and privacy cases the “most bizarre and
expensive system that it is possible to devise” for reasons
which essentially concerned the excessive costs' burden imposed on
defendants in such cases.
Jackson LJ therefore recommended to the Ministry of
Justice far-reaching reform. He recommended, for all civil litigation
including privacy cases, a return to CFAs whose success fees and ATE
premiums were not recoverable from the losing party (the pre-1999 Act
position), pointing out that the pre-1999 Act arrangements had not
suffered from the above flaws and still extended access to justice
for many individuals who formerly had none. If that recommendation
were to be adopted, a further two recommendations (specifically
concerning defamation and privacy actions) were made to ensure the
objective of ensuring access to justice for claimants of slender
means: increasing the general level of damages in defamation and
breach of privacy cases by 10% and introducing a regime of qualified
one-way costs shifting, so that the amount of costs an unsuccessful
claimant might be ordered to pay was a reasonable amount, reflective
of the means of the parties and their conduct in the proceedings.
The subsequent report of the House of Commons of 2010
again recognised similar flaws of recoverable success fees (the
“blackmail” effect on the press; “cherry picking”
by lawyers so that CFA cases were rarely lost; and the lack of
incentive on lawyers or their clients to control costs). It
considered that those problems had to be addressed urgently and it
proposed to limit the recoverability of success fees to 10% of the
base costs with the balance to be agreed between the solicitor and
client.
The further Consultation Paper in January 2010
recorded the particular concern of the Ministry of Justice about the
impact of 100% success fees in publication cases. It considered that
experience over the past decade had shown that, in defamation
proceedings in particular, “the balance had swung too far in
favour of the interests of claimants and against the interests of
defendants” and it noted that the Government did not believe
that the “present maximum success fee in defamation proceedings
is justifiable in the public interest”. Pending fuller
consideration of Jackson LJ's proposals, the Ministry sought views on
a proposal to reduce the maximum uplift from 100% to 10% of the base
costs in defamation and privacy cases. In March 2010 the Ministry of
Justice confirmed that legislation had been put to Parliament to
reduce success fees. Pending a fuller assessment of the Jackson
Review which set out a “clear case for CFA reform”, this
was only an interim proposal. However, this interim solution was not
maintained given the intervening general election in April 2010.
In summary, within four years of the introduction by
the 1999 Act of recoverable success fees to the existing CFA scheme,
concerns expressed in the industry about consequent excessive costs
orders, notably, in defamation and other publication including
privacy cases, led to detailed public consultations by the Ministry
of Justice and inquiries by Committees of the House of Commons, as
well as a far-reaching review of costs in civil litigation
commissioned by the Ministry.
The Ministry of Justice acknowledged in that process that, as a
result of recoverable success fees, the costs burden in civil
litigation was excessive and, in particular, that the balance had
swung too far in favour of claimants and against the interests of
defendants. This was particularly so in defamation and privacy cases.
Not only was the burden on defendants in publication cases recognised
as excessive but one of the acknowledged flaws of the scheme - the
opportunity for solicitors to “cherry pick” cases
evidenced by the success of publication cases run on a CFA/success
fee basis - would appear to indicate that the scheme has not achieved
the espoused aim of ensuring access to justice of the broadest range
of persons.
Of equal importance, Jackson LJ considered that the pre-1999 Act
position achieved that aim without overburdening defendants, a point
with which a large number of respondents to the 2010 consultation of
the Ministry had agreed (paragraph 119 above). Moreover, pending
fuller consideration of the broader recommendations of Jackson LJ,
the Ministry of Justice introduced legislation as a first step
towards solving the acknowledged problems by drastically reducing the
maximum success fee to 10%, precisely the core point impugned by the
present applicant. However, the Government were unable to ensure the
adoption of the legislation and have not indicated whether this or
any other legislation has since been proposed for adoption.
The Government relied on the domestic courts' ability
to control costs in publication proceedings through the provisions of
the CPR and the Costs Practice Directions. However, the second flaw
highlighted in the Jackson Review indicates that those safeguards
were undermined by a combination of an uncontrolled “costs
race” provoked by the impugned scheme during an action and the
difficulty of a court in effectively assessing those costs after the
action. In addition, while those provisions addressed the
reasonableness of base costs given matters such as the amount at
stake, the interests of the parties and the complexity of the issues,
Lord Hope underlined that the separate control of the reasonableness
of success fees essentially concerned the review of the percentage
uplift on the basis of the risk undertaken in the case and that, in
an evenly balanced case such as the present, success fees were
inevitably 100% (see also Designer's Guild Limited, cited at
paragraph 97 above). Such safeguard provisions could not, therefore,
as Lord Hoffman confirmed, address the applicant's rejection in
principle of recoverable success fees calculated as a percentage of
reasonable base costs. Moreover, these safeguards relied on by the
Government were available throughout the period of public
consultation at the end of which the Ministry of Justice accepted
that costs were disproportionate, especially in publication cases, so
that a drastic reduction in the maximum success fee was required.
The Government did not address in detail the public
consultation process, much of which had taken place after their
observations were submitted in March 2009. It is also true that
attempts by a State to improve a scheme does not mean, of itself,
that the existing scheme is in violation of the Convention (Brecknell
v. the United Kingdom, cited above, at § 70).
However,
the Court considers that the depth and nature of the flaws in the
system, highlighted in convincing detail by the public consultation
process, and accepted in important respects by the Ministry of
Justice, are such that the Court can conclude that the impugned
scheme exceeded even the broad margin of appreciation to be accorded
to the State in respect of general measures pursuing social and
economic interests (the above-cited case of Tolstoy Miloslavsky v.
the United Kingdom, at § 50).
This conclusion is indeed borne out by the facts of
the present case.
On the one hand, the claimant was wealthy and not in the category of
persons considered excluded from access to justice for financial
reasons. Her representatives accepted in the domestic proceedings
(paragraph 181 above) that they did not do much CFA work, which
limited their potential to act for impecunious claimants with access
to justice problems. The applicant's case was not without merit, in
that the Court of Appeal and a minority of the House of Lords
considered that the impugned articles did not violate Ms Campbell's
right to private life.
On the other hand, and while accepting that the proceedings were
lengthy and somewhat complex, the total costs billed by the claimant,
as regards the two appeals to the House of Lords alone, amounted to
GBP 850,000.00, of which GBP 365,077.13 represented success fees. It
is true that the applicant, in the end, reached a settlement of the
costs of both appeals paying the total sum of GBP 500,000.00 (base
costs and success fees). However, given the findings of the House of
Lords and of the Judicial Taxing Officers in the second appeal
(paragraphs 70 and 80, respectively) as well as in the similar
above-cited case of Designer's Guild Limited, success fees
were clearly recoverable against the applicant and, further, at the
rates of 95% and 100% in the first appeal and 95% for the solicitors'
costs in the second appeal. Accordingly, even if it is not possible
to quantify with certainty the precise amounts paid by the applicant
which can be attributed to success fees, it is evident that the
negotiated costs settlements reflected the obligation on the
applicant to discharge substantial success fees.
In such circumstances, the Court considers that the
requirement that the applicant pay success fees to the claimant was
disproportionate having regard to the legitimate aims sought to be
achieved and exceeded even the broad margin of appreciation accorded
to the Government in such matters.
Accordingly, the Court finds that there has been a
violation of Article 10 of the Convention.
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
Article 41 of the Convention provides:
“If the Court finds that there has been a
violation of the Convention or the Protocols thereto, and if the
internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford
just satisfaction to the injured party.”
The applicant claimed reimbursement of the success
fees paid to the claimant following both appeals to the House of
Lords. Since the success fees claimed by her as regards the first
appeal amounted to 47% of the total appeal costs billed, the
applicant claimed reimbursement of GBP 164,500, being 47% of the
total appeal costs actually paid in settlement by it. By the same
reasoning, it claimed GBP 50,000 for the success fee for the second
appeal, that being 33% of the total costs paid by it (the lower
percentage reflecting the fact that only the solicitors' fees were
subject to a CFA in the second appeal). This amounted to a total
claim of GBP 214,000 in pecuniary damages.
223. The applicant also claimed GBP 100,000 (inclusive of
interest and taxation costs) being the costs paid by it, using the
above means of calculation, in settlement of the base costs claimed
pursuant to the costs order against it as in the second appeal to the
House of Lords.
The applicant further claimed GBP 41,258.00 in
respect of its costs in preparing a separate application on the costs
issue for this Court. A further GBP 52,349.00 was claimed for work
done on both the breach of confidence and costs issues since the
communication of the cases. Vouchers were submitted for all costs
claimed.
The Government did not dispute the applicant's
analysis as regards the success fees but disputed the amounts
claimed. The costs' settlements between the applicant and the
claimant did not specify an amount paid in respect of the success
fees and, as a matter of principle, it should be assumed that the
bulk of the costs paid were base costs, which would be consistent
with the applicant's stance of opposition to payment of the success
fees. The pecuniary loss for the first appeal should be GBP
35,511.00, the amount by which the sum paid in respect of the first
appeal exceeded the base costs billed. The pecuniary loss as regards
the second appeal should be zero since the sum paid by the applicant
(GBP 150,000) was less than the claimed base costs (GBP 170,499.82).
The Government did not address the applicant's request for
reimbursement of the base costs of the second appeal to the House of
Lords.
The Government also made detailed submissions to the
effect that the costs claimed in respect of the application to this
Court were plainly excessive.
The
Court considers that the question of the application of Article 41
is not ready for decision. The question must accordingly be reserved
and the further procedure fixed with due regard to the possibility of
agreement being reached between the Government and the applicants.
FOR THESE REASONS, THE COURT
1. Declares unanimously the application admissible;
Holds by six votes to one that there has been no
violation of Article 10 of the Convention as regards the finding
of a breach of confidence against the applicant;
Holds unanimously that there has been a
violation of Article 10 of the Convention as regards the success
fees payable by the applicant;
Holds unanimously that the question of the
application of Article 41 is not ready for decision;
accordingly,
(a) reserves
the said question;
(b) invites
the Government and the applicants to submit, within the three months
from the date on which the judgment becomes final in accordance with
Article 44 § 2 of the Convention, their written observations on
the matter and, in particular, to notify the Court of any agreement
that they may reach;
(c) reserves
the further procedure and delegates to the President of the
Chamber the power to fix the same if need be.
Done in English, and notified in writing on 18 January 2011, pursuant
to Rule 77 §§ 2 and 3 of the Rules of Court.
Fatoş Aracı Ljiljana
Mijović
Deputy Registrar President
In accordance with Article 45 § 2 of the Convention and Rule 74
§ 2 of the Rules of Court, the separate opinion of Judge David
Thór Björgvinsson is annexed to this judgment.
F.A.
L.M.
PARTLY DISSENTING OPINION OF JUDGE
DAVID
THÓR BJÖRGVINSSON
1. I
agree with the majority that there has been a violation of Article 10
of the Convention as regards the costs payable by the applicant.
However, I disagree that there has been no violation of that
provision on account of the domestic court's finding of a breach of
privacy (“confidence”) against the applicant.
2. It
is not disputed that the basic facts of Ms C's drug addiction and
treatment were publishable in the public interest. This is so not
only because she had earlier pronounced publicly that she did not
take illegal drugs but also because she herself is a public figure
who, as an international fashion model and celebrity, has a direct
interest in projecting a certain image of herself in the mind of the
general public in order to exploit that image to promote her
professional ventures and interests. In this light, Ms C's earlier
statements that she did not take drugs can be seen as an intentional
projection of an inaccurate image. The applicant was therefore
justified in alerting the public to the truth about her drug problem.
3. The
main issue in dispute before the domestic courts was whether the
publication of the additional information was justified. This
additional information consisted of a report that Ms C was attending
NA meetings, information about those meetings as well as two
photographs of her outside the NA centre. The majority of the Chamber
agreed with the domestic courts that the publication of this
additional information was not justified. It would seem that the main
reason for its stance is that the relevance and sufficiency of the
reasoning of the House of Lords concerning the limits of the latitude
given to an editor's decision to publish the additional material “is
such that the Court does not find any reason, let alone a strong
reason, to substitute its view for that of the final decision of the
House of Lords or to prefer the decision of the minority over that of
the majority of the House of Lords...” (paragraph 155). I find
the approach of the Chamber to be unacceptable for a number of
reasons.
4. Firstly,
at least some of the principles applied by the House of Lords are not
relevant in the balancing exercise. I refer in this regard to
Baroness Hale's opinion that it was “not necessary to publish
any further information ...” (paragraph 152 of the judgment of
the House of Lords and paragraph 38 above). The test implied in that
opinion is the wrong one. From the point of view of journalistic
discretion in the presentation of a legitimate story, it is the
restriction on freedom of expression that must be justified by
reference to 'necessity' and not the publication as such. Secondly,
insofar as the relevant principles are concerned, they have not been
correctly applied on all counts. I agree that the “public
interest” test was correctly applied when the majority found
that the publication of the original story was in the public
interest. However, its finding that the publication of the additional
material was not is difficult to justify. I find this distinction in
principle between the original story and the supplementary material
to be unconvincing.
5. However, in the final analysis, the majority
simply defers to the assessment made by the domestic courts. This
approach is inconsistent with the 'strict scrutiny' that is usually
found in this Court's case law in balancing Article 8 and Article 10
rights where the Court regularly makes its own independent assessment
of the facts involved and of the application of the relevant
principles to those facts and it frequently substitutes its own views
for those of the domestic courts. It has been the consistent approach
of this Court that it is not enough, in itself, that the domestic
courts consider the relevant principles; they must also be applied
correctly (in this regard, see, for example, Fressoz and
Roire v. France [GC], no. 29183/95, ECHR 1999 I;
Von Hannover v. Germany, no. 59320/00, ECHR 2004 VI;
Biriuk v. Lithuania, no. 23373/03, 25 November 2008;
Petrenco v. Moldova, no. 20928/05, 30 March 2010;
Flinkkilä and Others v. Finland, no. 25576/04,
6 April 2010; and Mariapori v. Finland, no. 37751/07, 6 July
2010). In these and many other cases, the Court
has made its own assessment and reversed the findings of the domestic
courts without suggesting that the domestic courts had considered
irrelevant principles or applied improper criteria in the overall
assessment made. I do not see why a different approach should be
adopted in this case.
6.
Annoying as Ms C may have found the
publication of the story in question, the applicant newspaper was
justified in alerting the public about her drug addiction. The
additional information and the photographs were no more than a
continuation of the original legitimate story. I agree with the
unanimous decision of the Court of Appeal and the views of Lord
Nicholls and Lord Hoffman JJ of the House of Lords that this addition
did not reveal anything fundamentally significant to the story but
served mostly “to add colour and conviction” to it. In my
view, the publication of the supplementary materials fell well within
the journalistic margin of the press in deciding the way in which a
legitimate story is presented (see, for example, Fressoz
and Roire v. France, cited above, at § 54).
Thus, even accepting that the publication of the additional
information and pictures was a further incursion into Ms C's private
life, it was only to a relatively minor degree in the overall context
of the story as a whole. It cannot be considered as sufficient and
serious enough to justify the restriction on freedom of expression
under Article 10.
